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Complaints Handling and Redress Flashcards

7 cards from real FCA practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.

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  1. The Financial Ombudsman Service was established under which legislation?

    Answer: Financial Services and Markets Act 2000 (FSMA)

    The FOS was established under the Financial Services and Markets Act 2000 (FSMA) as the statutory scheme for resolving disputes between consumers and authorized financial firms.

  2. On what basis does the Financial Ombudsman Service decide complaints?

    Answer: What is fair and reasonable in all the circumstances of the case

    Under DISP 3.6.1, the FOS determines complaints on the basis of what is fair and reasonable in all the circumstances, which may go beyond strict legal rights.

  3. What is the FOS award limit for complaints referred on or after 1 April 2020?

    Answer: £375,000

    The FOS compulsory jurisdiction award limit was increased to £375,000 for complaints referred on or after 1 April 2020, reflecting inflation and the need to provide meaningful redress.

  4. Under DISP, what must a firm do upon receiving a complaint from an eligible complainant?

    Answer: Acknowledge, investigate thoroughly, and respond appropriately within required timeframes

    Firms must have procedures to acknowledge, investigate, and respond to complaints fairly and promptly, adhering to DISP timeframes and notification requirements.

  5. In the context of FCA complaints handling, what does 'redress' mean?

    Answer: Compensation or remedial action to restore the complainant to the position they should have been in

    Redress refers to the remedy provided to a complainant — typically financial compensation — intended to put them back in the position they would have been in had the firm not acted improperly.

  6. Under DISP 1.10, firms are required to report complaints data to the FCA. How frequently must this reporting occur?

    Answer: Every 6 months (bi-annually)

    DISP 1.10 requires firms to submit a complaints return to the FCA every 6 months, enabling the FCA to monitor complaints trends and identify firms or sectors with potential conduct issues.

  7. Which of the following statements about the FOS compulsory jurisdiction is correct?

    Answer: All FCA-authorized firms are automatically subject to the FOS compulsory jurisdiction

    Under DISP 2.2, FCA authorization automatically brings firms within the FOS compulsory jurisdiction — there is no opt-out and no separate application needed.