Complaints to FOS still rising
The number of complaints to the Financial Ombudsman Service (FOS) concerning financial investments has continued to rise, jumping by 27 per cent in the 2009-2010 financial year, according to the FOS annual review.
The FOS received 1,999 disputes about investments, a jump of 427 complaints in the 2009-2010 financial year. The FOS recorded a jump of 68 per cent in investment related disputes in the previous year.
Of the total number of investment disputes FOS investigated in the last financial year, 38 per cent of them involved problems with financial advice given by financial service providers, while 18 per cent of them concerned disclosure agreements.
Fifty-eight per cent of the investment disputes that the FOS handled during the last financial year were about products or services provided by financial planners. Of all the disputes concerning financial advisers, 59 per cent involved financial advice, a slight increase of 8 per cent compared to last year.
However, planners are improving their services to clients, with a drop of 17 per cent in complaints about services provided by planners to clients compared to 2008-2009 data.
Despite the Future of Financial Advice reforms and the industry shift to fee-for-service advice, disputes about charging by financial planners rose only slightly, from 2 per cent to 4 per cent compared to 2008-2009.
Disputes over disclosure also improved, dropped slightly from 13 per cent to 11 per cent during the last financial year.
The FOS recorded an increase in dispute numbers per month as a result of new terms of reference introduced during the last financial year. The new terms of reference gave the service the power to consider disputes involving legal proceedings.
Recommended for you
ASIC has released the results of its first adviser exam to be held in 2025, with 241 candidates attempting the test.
Quarterly Wealth Data analysis has uncovered positive improvements in financial adviser numbers compared with losses in the prior corresponding period.
Holding portfolios that are too complex or personalised can be a detractor for acquirers of financial advice firms as they require too much effort to maintain post-acquisition.
As the financial advice profession continues to wait on further DBFO legislation, industry commentators have encouraged advisers to act now in driving practice efficiency.
