This morning, I spent a very pleasant two-and-a-half hours at a Financial Ombudsman Service (FOS) roadshow. The sun shone. The venue itself was pleasant (Miskin Manor). At half-time we wandered out into the gardens to sup our coffee and were serenaded (oddly) by a bagpipe player, which was...pleasant. All very civilised, and the sheer civility of it all clearly had an impact on the IFAs attending, some of whom have been known in the past to froth and rave at events hosted by our regulators. Today, the level of restraint was just uncanny.
For this was an 'Outreach' event - it was about 'meeting the Ombudsman', and sure enough there was a very winsome, articulate chap called Phil who had that job title. He even got (a little later on) to tell us a little about the subject of Ombudsmanning in practice, but during the course of the presentation we learned a number of facts about the explosion of complaints which one suspects were intended to foster a culture of sympathy and tolerance. All in all, the whole event seemed intended to be disarming, and it had that effect. We were disarmed - and towards the end of the final section, we were encouraged to interact "nicely" with the Adjudicator, rather than allow ourselves to behave "reactively". Given the mendacious nature of some complaints - which get treated seriously by the FOS - this is actually quite a Big Ask.
Above and beyond a few statistics (which I promise not to regurgitate here), I am afraid I learned nothing new, other than noting the use of some buzzwords or assertions which seem reasonable if taken at face value, but where nobody seemed prepared to unpack them for us. The severely limited question time meant that there was little opportunity to seek clarification. For two-and-a-half hours I took careful notes, but was given nothing of substance which would lead me to have more confidence in whatever it is that the FOS gets up to: we were in sound-bite land, and the tacit assumption of "niceness" meant that we were expected to make do with what we were given. And, on the whole, that's what happened.
Instead, I found myself picking up on little hints and clues from what was being said. One could not draw forensic conclusions from them, but when put together, they were of interest. Very early on, the role of the FOS was carefully contrasted with that of the Courts - and the law was described (in that context) as "harsh". Much stress was then laid upon their "informal" process (which is warm and cuddly by comparison) and their focus on arriving at adjudications which are "fair and reasonable". We were told that the FOS are under an obligation to "look at the rules and regulations", but the immediate context already very clearly indicated that 'rules and regs' were quite definitely going to be further down the pecking order to what is clearly a more subjective frame of reference. We were never told, for instance, what "fair and reasonable" meant in practice - but we were given one example (which probably would be irrelevant to most of the audience) which was so clearly black and white, that it would have been impossible to disagree with the way the FOS chose to handle matters. In the real world, the ethical dimension is rarely so self-evident, and one was still left in the dark about what the "fair and reasonable" mantra might mean in practice.
It seemed that mantras are de rigeur
with the FOS, as a little later on we encountered another one: "evidence, evidence, evidence". The strangely blairite phrase appeared on a slide, and was repeated by the Ombudsman. We were told that they "base their decisions on it" (on the three E's). In practice, such a mantra can mean almost anything one wants it to mean. The Ombudsman sought to accrete further layers of ambiguity, in order to underscore the "fair and reasonable" strapline, by telling us that, "We look at what we've got, and do our best with it". Frankly, given the mind-boggling sums of money that are tied up in the mega-business of Ombudsmanning, it doesn't seem unreasonable for the Regulated Community (who pay the bills) to expect rather more clarity than we were being given. For, in practice, FOS Adjudicators may indeed "look at what we've got", but then go on to make a decision based upon an unworldly rubric that appears to dance around the data, rather than take it into consideration. I suspect that we are now paying our lawyers fees for a masseuse to help unknot their furrowed brows, acquired whilst attempting to unravel judgements that seem to come out of nowhere, and apparently demonstrate only a token nod in the direction of the regulations that we are subject to.
We also learned from the Ombudsman that "we're not a court, bound by precedents", which is certainly true in our experience. The presence or absence of key file components can give rise to arguments in favour of redress based upon the complete inversion of arguments used previously in near identical cases. For the humble IFA, trying to make sense of Ombudsmanning, and wishing to retain some faith in the system as it is, this is all deeply perplexing - one would almost cry out for precedents. 'Outreach' conducted in this manner leaves behind the sneaking suspicion that one has just had a few more layers of wool placed over one's eyes.