The Financial Ombudsman Service Decision Process Explained

Ian Lewis[1]

Ian Lewis

Money Savings Advice The Financial Ombudsman Service Decision Process Explained

The FOS decision process, otherwise known as the Financial Ombudsman Service decision process, is a two-stage procedure. The idea is simple.

A complaint will be reviewed by a handler/adjudicator and feedback given to the parties involved. If the parties disagree with the conclusion, they can request a formal review by the Financial Ombudsman Service.

While there has been a significant increase in the number of pension mis-selling complaints, many complaints are simply down to misunderstandings. This perfectly highlights the benefits of the two-stage approach by the Financial Ombudsman Service.

This approach ensures that relatively simple complaints are resolved in an informal manner, leaving more time for complicated complaints.

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Is the FOS Decision-Making Process Final?

Yes and no. As we touched on above, the FOS decision-making process is a two-stage affair. Each complaint is reviewed by a handler/adjudicator, and feedback is given to the parties involved. Each party has the right to disagree with the findings and seek a broader investigation into the complaint.

Is the Financial Ombudsman Service Stage II Decision-Making Process Final?

Yes. The Financial Ombudsman Service is a very powerful organisation and one which is respected by the financial services industry as a whole. The service takes an unbiased approach to all complaints, looking at the evidence, and making a ruling.

If the ruling is in favor of the consumer, then the financial services company/companies involved are required to right any financial wrongs.

How Long Does the Financial Ombudsman Service Take to Review Complaints?

It is impossible to say. Each complaint is different, and the type of evidence required can vary enormously. Relatively simple complaints can be addressed fairly quickly, leaving time for more complicated in-depth investigations.

If we look at, for example, the investigation into PPI complaints, this has gone on for many years and cost the banking industry billions of pounds. So, while time is of the essence, it is important that the Financial Ombudsman Service is given time to make the right decision.

There is an EU directive called the Alternative Dispute Resolution, which recommends a decision should be made within 90 days of receiving a complaint. In more complex cases, this is not always possible.

Can I Use the Services of a Claims Management Company?

Medical claims and financial claims are the two most complicated actions you will come across. Proving who said what, when they said it, and whether it was misunderstood, can be very challenging. As a consequence, we have seen a recent increase in the number of complainants using claims management companies to present their case.

Why Would You Use a Claims Management Company?

The answer is simple, experience, and advice. Complaints regarding financial advice on pension transfers have been increasing of late. Some of these can be extremely complicated and very difficult for those without pension fund knowledge to comprehend. So, surely it makes sense to use the services of a claims management company where you are uncertain?

How Much Do Claims Management Companies Charge?

It is important to ask the question because the answer is simple. If, after reviewing your evidence, a claims management company believes you have a minimum 60% chance of success, they will likely offer to take on your case.

More often than not, this would be on a “no-win, no fee” arrangement. This effectively indemnifies you from any costs incurred by the claims management company in pursuing your case. So, in theory, there is no cost.

Success Fees and Claiming Expenses

Prior to taking on your case, a claims management company would look to discuss a “success fee.” This is a contractual share of any compensation received and tends to be around the 25% level.

There are also cases where a successful outcome can lead to claims management companies recovering their expenses from the defendant. The reclaiming of expenses is not written in stone but, more often than not, is a real option for claims management companies.

Is There a Timescale in Lodging a Complaint for Pension Mis-Selling?

There are two timetables to be aware of. Initially, you will need to lodge a complaint within six years of receiving the advice in question. Alternatively, there is a three-year window of opportunity from the date that you found the advice to be inappropriate for your situation.

In a similar fashion to medical compensation claims, incidents of pensions mis-selling may not materialize until many years down the line.

Money Savings Advice Tip

Sadly where there is money involved there are unsavoury people who look to take advantage. If you feel you have been the victim of pension fraud and have lost money from your pension then we advise you to speak to a professional who can manage your claim properly.

How Can I Ensure Payment of Compensation for a Successful Claim?

The final decision by the Financial Ombudsman Service is legally binding. As a consequence, the vast majority of compensation claims are paid within 28 days of the final decision. In the event of non-payment, you should go back to the Financial Ombudsman Service and advise them of the delay.

The next step is usually to rubber-stamp the ruling through the courts, thereby placing more pressure on the defendant.

How Often Should I Review My Pension Fund Investments?

It makes sense to include your pension fund investments in your annual financial review. We know that many individuals will look at pension funds, savings, investments, and insurance policies in isolation.

This does not make sense. Looking at a specific subject in isolation could prompt a very different decision than when looking at all of your finances together.

Do I Need a Financial Adviser?

Yes, you probably do. The vast majority of financial advisers today have experience in many different areas. In areas where their experiences may be lacking, they will often have colleagues and contacts they can call upon.

There will be occasions where financial advice may not be required, but when you also throw issues such as mortgage finance into the mix, things can become a little more complicated.

As regulated financial advisers are legally obliged to act in your best interests, you also have a fallback in the event of substandard advice/services. If you can prove negligence on behalf of your financial adviser, you may be able to pursue compensation.


The Financial Ombudsman Service is a very powerful organisation, one which is very much respected by participants of the UK financial services industry. Final decisions from the ombudsman are rarely challenged, and, as we mentioned above, compensation is usually forthcoming within 28 days of the ruling.

The consequences of failing to abide by a final ruling could lead to the removal of authorisation to participate in the UK financial services sector. So, it is easy to see why very few final decisions are challenged.

How Can Money Savings Advice Help You With Making a Mis-Sold Pension Claim?

Here at Money Savings Advice, we have partnered with some of the UK’s leading Financial Claims management companies. They have already helped thousands of people claim compensation for a mis-sold pension and they can do the same for you.

Choosing an independent claims management company means they won’t proceed with a claim unless they are sure it is in your best interests. They are also regulated by the FCA, which gives you an additional layer of protection.

If you would like to speak to one of these claim management companies who can help you make a compensation claim, then click on the below and answer the very simple questions.

Money Savings Advice Author Ian Lewis

Ian Lewis

Ian Lewis is one of our specialist financial writers. Ian has over 15 years of financial writing experience, having worked for some of the largest financial publications in the UK covering topics from mortgages, equity release, loans and financial claims, to name a few.

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