Does the Ombudsman order an institution to compensate customers who havn't complained

F

Fin Crusader

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Brendan,

Do you have any reason why the Financial Services Ombudsman did not mandate Danske Bank to refund all customers affected. The F.S.O. have done this many times in relation to other financial matters?
 
Brendan,

Do you have any reason why the Financial Services Ombudsman did not mandate Danske Bank to refund all customers affected. The F.S.O. have done this many times in relation to other financial matters?

Again, I would ask you to back up this statement that the FSO has done this "many times."

They have the power to do it, but have rarely used it. Off the top of my head, I can remember only one - this case involving the Irish Nationwide. If I recall correctly, in a later case, not involving the Irish Nationwide, there was a question mark over whether the Ombudsman had that power.

It would be very helpful if you could provide a list of the "many times" the FSO has done this.
 
Here is Section 57 C(I)
[FONT=&quot](4) If a complaint is found to be wholly or partly substantiated, the Financial Services[/FONT]
[FONT=&quot]Ombudsman may direct the financial service provider to do one or more of the following:[/FONT]
[FONT=&quot]([/FONT][FONT=&quot]a[/FONT][FONT=&quot]) to review, rectify, mitigate or change the conduct complained of or its[/FONT]
[FONT=&quot]consequences;[/FONT]
[FONT=&quot] [/FONT]
[FONT=&quot] ([/FONT][FONT=&quot]b[/FONT][FONT=&quot]) to provide reasons or explanations for that conduct;[/FONT]
[FONT=&quot] ([/FONT][FONT=&quot]c[/FONT][FONT=&quot]) to change a practice relating to that conduct;[/FONT]
[FONT=&quot]([/FONT][FONT=&quot]d[/FONT][FONT=&quot]) to pay an amount of compensation to the complainant for any loss, expense or inconvenience sustained by the complainant as a result of the conduct complained of;[/FONT]
[FONT=&quot]([/FONT][FONT=&quot]e[/FONT][FONT=&quot]) to take any other lawful action.[/FONT]
 
This is what happened in the case of the Irish Nationwide
http://www.askaboutmoney.com/showthread.php?t=22110

from the [broken link removed] PDF Page 28 which suggests that the Ombudsman's powers are very limited


OMBUDSMAN’S SURPRISE AT
HOWLOWTHE LOOK BACK
FIGURE OF €1.56M PAID BY IRISH
NATIONWIDE BUILDING SOCIETY
WAS
I referred in previous Reports to the first ever High Court
Judicial review proceedings against me, as Financial
Services Ombudsman, taken by the Irish Nationwide
Building Society in January 2006. In the course of
deciding a complaint I had directed the Society in
January 2006 to change its rules and its practice of
charging automatic six months interest when
commercial mortgages were redeemed early. I
considered that this was not a genuine pre-estimate of
loss and was in effect a penalty, and therefore unlawful.
I had also brought the matter to the Financial Regulator’s
attention for any look back action it deemed necessary.
The High Court proceedings were settled in my favour in
May 2006 with full costs awarded.
In September 2006 agreement was eventually reached
between the Society and my Office as to how the early
redemption charge should be calculated for future and
past cases, based on a formula which calculates the
actual loss to the Society, if any, caused by the early
redemption. Following discussions with me the Financial
Regulator and the Society agreed in October 2006 to do
a ‘look back’ exercise under the general superintendence
of the Financial Regulator, going back six years from my
decision, and undertook to reimburse previous
borrowers in accordance with the newly agreed formula.
Originally it was reckoned by the Society itself that the
amount involved in the look back could be €3m and it
later rose to circa €6m, particularly following the action
that was necessary to be taken when I discovered, after I
received a complaint in March 2007, that the process
was not being carried out in line with what had been
agreed between the Regulator, the Society and me. In
May 2008 the Society informed me that €1.56m had
been refunded when the ‘look back’ exercise was
completed.
While I am very happy with the overall outcome in that
consumers benefited from the actions that I took I notedthat the final figure was substantially less than what had
been originally estimated by the Society. I can readily
appreciate that first estimates can be an unreliable guide
but my own informed calculation was that somewhere
between €3m and €3.5m would be a more realistic
figure. I was very surprised at how low the final figure
turned out to be and I communicated my concerns to
the Financial Regulator.
However the Regulator, acting on legal advice, was
prohibited from discussing the detail of its interaction
with the Society on this issue but stated that the Society
liaised very closely with it throughout the reimbursement
programme and that the Regulator was satisfied with
the overall manner in which the Society dealt with the
issue. Also neither the Regulator nor the Society would
supply me with the number of consumers who benefited
from this look back.
 
Brendan,

I believe in 2008 Hibernian Direct had to repay 16,000 euro to 370 customers. However I believe that the action against Hibernian direct was taken by the financial regulator and not the Financial services ombudsman. I believe you are right when you say the F.S.O utilised their mandating powers only once
 
Brendan,

I believe in 2008 Hibernian Direct had to repay 16,000 euro to 370 customers. However I believe that the action against Hibernian direct was taken by the financial regulator and not the Financial services ombudsman. I believe you are right when you say the F.S.O utilised their mandating powers only once
Fin Crusader.
You raise a very valid point in that we have FSO and Financial Regulator fishing in a similar pond.
It means no Regulated Office has power and control, in effect issues get moved without proper resolution.
Eg on this thread the FSO is clearly not happy with Nationwides payout but Financial Regulator gives FSO the brush off !

I am not sure any of our (Regulators) give a damn about consumers.
 
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