Unit 2 Topic 25 - Consumer rights, complaints and compensation Flashcards
What are the key consumer rights?
- Clear and honest information before they buy;
- Get what they pay for;
- Be supplied with goods that are fit for purpose and services that are performed with reasonable care and skill;
- Have any faults corrected free of charge, or get a refund/replacement.
What is the Consumer Rights Act 2015?
The first piece of legislation to detail what should happen if a service is not provided in the manner agreed or with reasonable care and skill. Essentially, the business that provided the service must align it with what was agreed or, if this is not realistic, provide a refund.
What is alternative dispute resolution?
ADR aims to help when a dispute with a consumer cannot be settled directly. The business involved in the dispute will engage the services of a certified alternative dispute resolution provider and must find out whether or not the consumer is willing to use the service.
What are the two options under alternative dispute resolution?
- Adjudication: Decisions can be appealed through courts
- Arbitration: Decisions cannot be appealed through courts.
What is the role of HM Treasury?
The government’s economic and finance ministry, maintaining control over public spending, setting the direction of economic policy and working to achieve strong and sustainable economic growth.
It is the department responsible for the regulation of financial services under the direct authority of the Chancellor of the Exchequer. The Chancellor is also responsible for the budget.
Which three existing providers of government advice make up The Single Financial Guidance Body (SFGB)?
- The Money Advice Service
- The Pensions Advisory Service
- Pension Wise
What are the five core functions of The Single Financial Guidance Body?
- Pensions guidance
- Money guidance
- Debt advice
- Consumer protection
- Strategy
What is ‘super-compliant’ status which organisations such as Which! and Citizens advice hold?
They have the power to make complaints direct to the FCA.
Where are the rules for dealing with complaints and compensation set out in by the FCA?
- The Handbook called ‘Dispute Resolution: complaints’ (more commonly referred to by its FCA reference code of ‘DISP’; and
- The ‘Compensation’ Handbook, referred to as ‘COMP’, which details the rules governing eligibility under the Financial Services Compensation Scheme and the levies payable by firms.
Who does the FCA define as an eligible complainant?
- A private individual, including individuals acting as persona guarantors for loans to businesses they are involved in and consumer buy-to-let consumers;
- A business with an annual turnover below £6.5m when the complaint is made; or
- A charity with an annual income of less than £6.5m when the complaint is made; or
- A trustee of a trust that has a net asset value of less than £5m when the complaint is made.
What is the complaints handling procedure set out by the FCA that firms must follow?
- Acknowledge
- Investigate
- Resolve
- Inform
- Advise
- Provide.
What is the deadline for Payment services providers to providing a response to complaints?
Must give a full response to a complain withing 15 days. This can be extended to 35 days in exceptional circumstances, with a holding letter sent in the interim.
What are the record keeping requirements firms must follow as defined by the FCA?
Records have to be retained for at least three years from the date a complaint is received.
Where the complain relates to collective portfolio management services for a UCITS scheme, the minimum period for which records must be retained is five years.
Where the complaint relates to MiFID business, there is no minimum retention period stated since 3 Jan 2018.
What the the FCA complaints report requirements?
On a six-monthly basis, firms are required to report to the FCA the following information:
- Total number of complaints received
- Total number of complaints closed
- Total number of complains:
1) Upheld in the report period
2) Outstanding at the beginning of the reporting period - Total amount of redress paid in respect of complaints during the reporting period
- The root causes of complaints and corrective action taken to prevent recurrence.
Define Time-Barred Complaint.
A complaint made outside the time limits for referral to the FOS; a firm may reject such a complaint, via a final response, without considering its merits.
