5th May 2009

FSCS stats and practices

Traffic lightsMoney Marketing has reported that the Financial Services Compensation scheme has paid out more than £33m to consumers as a result of claims on failed IFAs over the past financial year. In 2008/09, the FSCS received 8,730 claims against IFAs and found that 3,640 - 41.69% justified compensation totalling £33,095,000, an average of £9,092 per case.

Over 2008/09, the FSCS had just 54 claims against mortgage intermediaries and it deemed only 13 cases - 24%, suitable for compensation, which totalled £335,700, an average of £25,823 per case.

It would be interesting to find out how much these ratios and amount per case differ when compared to FOS findings as it would appear that with the FSCS, the rules for determining compensation and the calculation methodologies they employ differs from that of the FOS. In particular in certain cases the 15 year longstop influences part of the FSCS decision process. We would be very interested to have your experience/ knowledge feedback. Please e- mail help@panaceaadviser.com

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