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How to win when you're let down

Martyn Hocking
30/ 6/2008

HOWEVER careful you are when making financial decisions, it's inevitable that you will be let down by a product or service at some point. But if you know how to complain effectively you can get redress - and make sure you are not out of pocket.

FINANCIAL COMPLAINTS

If you have a complaint about a bank, insurance company, financial adviser or other financial firm, you should first complain to the company involved.

If this fails to resolve the problem, you can take your case to the Financial Ombudsman Service (FOS), which settles disputes between consumers and financial companies. It's free to use and can look at problems with most money matters, including banking, insurance, mortgages, credit cards and investments.

An adjudicator will first decide informally whether the company has treated you fairly or not, and, if it decides it hasn't, FOS will tell it how to resolve the problem.

If this doesn't settle the dispute, you can ask for your case to be looked at formally by an ombudsman. If you are not happy with this decision, you are still free to take your case to court.

Other ombudsman services may be able to help you. After you have taken your case to the Pensions Advisory Service, the next step is the Pensions Ombudsman, which investigates complaints about the way pensions schemes are run.

If you have complained about a lawyer to their professional body's complaints arm (the Legal Complaints Service for solicitors and the Bar Standards Board for barristers) and you are not happy with the result, the Legal Services Ombudsman may be able to help.

WHICH? CAMPAIGNS

Which? has campaigned on a number of areas affecting the finances of consumers and has helped thousands of people get the redress they deserve. Below, we explain how we can help in four areas.

Payment protection insurance

You are often sold payment protection insurance (PPI) when you take out a loan, mortgage, credit card or store card. This is designed to cover your payments in the event of accident, sickness or redundancy, but we think millions of people may have been mis-sold policies.

Visit www.which.co.uk/ppi to find outwhether you have been missold PPI and how to get your money back.

Bank charges

Banks currently charge you up to £38 for going into an unauthorised overdraft, which we think is excessive. But the High Court recently made its ruling in a test case between the Office of Fair Trading, seven banks and one building society.

The banks may appeal.

While the test case continues, most claims are likely to be suspended, but you should still complain to your bank so your claim can be dealt with when the case is over.

Visit www.which.co.uk/bankcharges .

Mortgage exit fees

If you have paid mortgage exit fees for leaving a lender or paying off your mortgage in the last six years, check whether the amount you paid was more than the figure stated on your original contract. If you were charged more, you may be able to claim all or some of what you paid back.

Visitwww.which.co.uk/mortgages for our template letters to send to the lender.

Endowments

We believe that 5m people may have been mis-sold endowment policies with their mortgage by financial advisers who failed to explain that these policies might not grow enough to pay off the loan at the end of the term. However, many people have run out of time to complain as the final date given to them by the firm has passed.

Go to www.which.co.uk/campaigns to find outmore and for our template complaint letter.

CLAIMS HANDLERS

There are a large number of firms that offer to deal with financial complaints for you, covering everything from bank charges to endowments and PPI. Most of them work on a no-win no-fee basis and charge between 15 per cent and 30 per cent of any compensation or refund you get. Some also charge upfront fees of around £50 to £75 - you should never pay more than this upfront.

We think using a claims handler is unnecessary, as you can successfully deal with complaints yourself for free through FOS, which is designed to be used by consumers without any other help.