Financial Ombudsman Service award limit adjustment from 1 April 2020
What has happened?
The FCA has stated that, from 1 April 2020, it will adjust both FOS award limits each year to ensure they keep pace with inflation. It will do this by applying the percentage increase in the Consumer Prices Index (CPI) between January 2019 and January 2020 and rounding the adjusted figure down to the nearest £5,000.
Following the publication of the CPI figures for January 2020, the FCA has increased the award limit for complaints referred to the Ombudsman Service on or after 1 April 2020 to £355,000 for complaints about acts or omissions on or after 1 April 2019. There will be no changes to the other limits, which will remain at £160,000.
What do you need to do?
For MiFID business, COBS 6.1ZA.5 EU (there is a similar requirement applying to non-MiFID business contained in COBS 6.1.7) requires firms to disclose;
where the investment firm holds client financial instruments or client funds, a summary description of the steps which it takes to ensure their protection, including summary details of any relevant investor compensation or deposit guarantee scheme which applies to the firm by virtue of its activities in a Member State;
It is clear that CASS firms will need to amend their FOS disclosures to show the new award limit from 1st April.
How can we help you?
If you’d like further information, to arrange a review of your CASS or complaints handling arrangements, or to discuss any other aspect of compliance, our expert team is here to help. Contact us today on 0207 436 0630 or email info@thistleinitiatives.co.uk.