Watchdog received 26,000 current account complaints last year as fraud victims fought for damages
The number of current account complaints to the Financial Ombudsman is on the rise as victims of fraud increasingly turn to the service to claim compensation.
The National Arbitrator of Financial Complaints is the last line of defense for those who fight financial firms for compensation, which often runs into the thousands of pounds.
The total number of complaints to the financial ombudsman service is also rising, but current accounts top the list of complaints.
The independent government-backed body received 26,039 complaints about these accounts in the 12 months to April 2023.
The main reason cited was that banks did not provide sufficient support to victims of fraud who had money debited from a bank account.
Claims: the financial ombudsman service is the last line of defense for those who fight financial firms for compensation – often thousands of pounds
Hundreds of people fighting for fraud refunds to the ombudsman are winning their case, an analysis by Money Mail’s sister website, This is Money, showed last month.
It found that last year the Ombudsman sided with 370 consumers in battles with their High Street bank or credit card company and ordered refunds. In one case against the bank Santander this amounted to a whopping £345,750.
When someone is defrauded, for example after their bank card is stolen, a bank must refund the full amount. But if a customer runs out of money, such as paying an imposter who lied, the rules aren’t so clear.
Most banks have signed a voluntary agreement to pay in such circumstances, but if customers are not happy with the outcome, they can go to the ombudsman.
Another big complaint is shoddy customer service, with banks closing branches and redirecting people to automated services, making it more difficult for customers who prefer to meet in person.
The ombudsman received a total of 165,149 complaints, of which 35 percent were resolved in favor of the complainant.
Credit cards were the second most complained product with 14,504. Problems included credit deals being passed on to vulnerable customers with unaffordable terms.
The next most complained about financial services was auto insurance, with 11,851 complaints for the year ended April – a 27 percent increase from the previous year. Difficulty getting insurers to pay out vehicle damage was a major problem.
There has also been an 85 percent increase in car hire purchase cases over the course of the year. It now stands at 11,446. Much of this was due to additional costs hidden in the fine print of contracts, such as sales commissions, fees and surcharges.
The ombudsman received 6,497 complaints about home insurance – with grumbling not only about the amount of money offered to settle a claim, but also the time it took insurers to pay.
Fake investment opportunities set up by scammers to get rich quick were another major reason consumers turned to the ombudsman.
If you have a problem with a financial company that has not handled a complaint to your satisfaction, please call the Financial Ombudsman Service on 0800 023 4567.
toby.walne@dailymail.co.uk