Thousands of PPI cases could be reassessed

Undercover investigation into financial ombudsman finds inadequate training and inexperienced staff

PPI mis-selling could be going unpunished because financial ombudsman staff lack expertise, an undercover investigation found.

Staff with inadequate training or understanding of financial products are handling cases, some of which have been concluded in favour of the banks, without properly reading documents.

The investigation was conducted by Channel 4’s Dispatches into the Financial Ombusman Service (FOS), which makes judgments on disputes between consumers and financial services.

More than a million people contact the service every year, meaning that hundreds of thousands of cases may need to be reassessed.

Past and present staff told reporters of problems at the service, including improper training and, previously, unachievable targets. Baroness Ros Altmann, a former pensions minister, said some of the footage was “shocking”. “The Government should urgently look at and ask for the management of the financial ombudsman service to justify some of the evidence we’ve seen here,” she said.

An undercover reporter, posing as a trainee investigator tasked with resolving disputes, was told by instructors that some staff did not have financial backgrounds. Her mentor at the service said she sometimes had to “Google” products to find out what they were.

A whistleblower at the FOS, who asked to remain anonymous, told Dispatches that in complex cases the right decision was not always made and “legitimate claims are being missed.”

“I’m not proud to admit it but I’ve done it myself – just taken a chance and just slung stuff through, with any old decision,” the whistleblower said.

The investigation also raises concerns over unmanageable caseloads that were assigned to staff after a buildup in 2014-15, partly because of the level of PPI claims.

Investigators were “just churning” out cases, the reporter was told, and banks were being wrongly favoured as it was more difficult to persuade businesses than consumers. The FOS says it has a customer satisfaction rating of 75 per cent. In response to the programme, which will be aired tonight, the service said: “The impression given is clearly not representative of us at our best. We’re determined to provide the best support for our staff and a fair and trustworthy service for customers.”

Rushanara Ali, an MP who sits on the Treasury select committee, which oversees the service, told Dispatches the FOS needed “to explain themselves”, and: “I would hope that our committee can call them back in and if necessary conduct an inquiry into these allegations.”