CII R01 Complaints Handling 3 — Questions and Answers
Question 1: What is the FOS's jurisdiction based on?
- The size of the claim only
- Whether the complaint involves a regulated activity by an FCA-authorised firm and an eligible complainant (Correct answer)
- Whether the firm agrees to use the FOS
- Whether the complaint was made within 30 days
Correct answer: Whether the complaint involves a regulated activity by an FCA-authorised firm and an eligible complainant
The FOS can consider complaints where the activity is within its jurisdiction (generally regulated activities), the firm is covered (FCA-authorised or otherwise within scope), and the complainant is eligible.
Question 2: How does the FOS determine the outcome of a complaint?
- It always decides in favour of the consumer
- It determines what is fair and reasonable in all the circumstances of the case (Correct answer)
- It strictly applies the letter of the law
- It follows the firm's internal policies
Correct answer: It determines what is fair and reasonable in all the circumstances of the case
The FOS determines complaints by reference to what is fair and reasonable in all the circumstances, taking into account relevant law, regulations, guidance, codes of practice, and good industry practice.
Question 3: What is a 'final decision' from the FOS?
- The firm's final response letter
- A binding decision issued by an ombudsman after investigation, which the complainant can accept or reject (Correct answer)
- The FCA's final ruling on a regulatory matter
- A court judgment on a financial dispute
Correct answer: A binding decision issued by an ombudsman after investigation, which the complainant can accept or reject
A final decision is issued by an ombudsman and is binding on the firm if accepted by the complainant. If the complainant rejects it, they can still pursue the matter through the courts.
Question 4: What is the 'eight-week rule' in complaints handling?
- Firms must retain complaint records for 8 weeks
- Firms must issue a final response within 8 weeks, or explain the delay and inform about FOS referral rights (Correct answer)
- Firms have 8 weeks to acknowledge a complaint
- The FOS must resolve complaints within 8 weeks
Correct answer: Firms must issue a final response within 8 weeks, or explain the delay and inform about FOS referral rights
If a firm cannot resolve a complaint within 8 weeks of receipt, it must send a final response or a letter explaining why it needs more time and informing the complainant of their right to refer to the FOS.
Question 5: What records must firms keep regarding complaints?
- No specific records are required
- Records of each complaint received, the measures taken to resolve it, and whether it was resolved by close of the next business day (Correct answer)
- Only records of complaints that resulted in compensation payments
- Only records of complaints referred to the FOS
Correct answer: Records of each complaint received, the measures taken to resolve it, and whether it was resolved by close of the next business day
Firms must maintain records of each complaint, including the subject matter, any correspondence, and the measures taken for resolution. Records must be retained for at least three years (five years for MiFID complaints).
Question 6: How long must firms retain complaint records?
- 1 year
- 3 years from the date of receipt of the complaint (5 years for MiFID complaints) (Correct answer)
- 10 years
- Indefinitely
Correct answer: 3 years from the date of receipt of the complaint (5 years for MiFID complaints)
Under DISP, firms must retain complaint records for at least 3 years from the date of receipt. For complaints relating to MiFID business, records must be kept for at least 5 years.
CII R01 Complaints Handling 3
What is the FOS's jurisdiction based on?