People entering RPC building.

Happy New maximum award limit

23 December 2011

It is a sobering thought that FOS complaints made from January will be subject to the increased maximum award limit of £150k.

As I noted in June, the new limit will apply regardless of when the matters complained about took place.

With the FSA's on-going wealth management review and planned UCIS review, there are likely to be plenty of complaints relating to six figure losses from higher net worth retail clients. The strict client categorisation regime (COBS 3.5) means firms - even if tempted - will find it hard to classify clients as professional and thereby avoid FOS jurisdiction.  And with the Courts paying ever more regard to FSA rules and principles, there may be an increasingly limited difference between the parallel jurisdictions.

As no liability limit applies to a firm's own complaints handling - or any PBR undertaken or imposed - the FOS and FSA will likely be on the look out for firms trying to 'cap' their liabilities by rejecting complaints and steering them towards FOS.