You probably assume that your creditor, and anyone who introduces you to creditors, are operating in a fair way, giving you the best deal.
But, there have been lots of examples in the media in recent years of brokers, financial advisors and lenders not treating their customers fairly. Think of PPI mis-selling. This is only one example. So, have things changed?
The Financial Conduct Authority
The Financial Conduct Authority (FCA) believes that you should be treated fairly at all times, especially when you are dealing with any firm that is regulated and authorised by them.
It’s a formal requirement laid down by the FCA to ensure that all financial services provided to consumers are done so in a way that isn’t detrimental to the customer. They have defined their expectations for how financial firms should act to ensure they are ‘treating Customers Fairly’.
What are the six TCF consumer principles?
- Consumers can be confident that they are dealing with firms where the fair treatment of customers is central to the corporate culture. The FCA want companies to do the right thing because it’s in their corporate culture to do so. It’s all about integrity and honesty right from the outset, and making sure that everyone knows where they stand.
- Products and services marketed and sold in the retail market are designed to meet the needs of identified consumer groups and are targeted accordingly. This means that financial products have to be affordable for the specific individual they are sold to, and should only be sold to someone if they actually need the product.
- Consumers are provided with clear information and are kept appropriately informed before, during and after the point of sale. This means lenders can’t hide things in the small print, they have to make all costs and any risks very clear to customers before they agree to take out a financial product.
- Where customers receive advice, the advice is suitable and takes account of their circumstances. This means brokers, financial advisors, or lenders have to give the best possible advice relevant to your specific circumstances.
- Consumers are provided with products that perform as firms have led them to expect, and the associated service is both of an acceptable standard and as they have been led to expect. Just like when buying any other product, this means that lenders are obligated to only provide products that they can guarantee will perform as they say they will. This principle covers all types of financial products, from pensions and loans to insurance and bank accounts.
- Consumers do not face unreasonable post-sale barriers imposed by firms to change product, switch provider, submit a claim or make a complaint. In short, if you want to switch providers, make a claim, or even complain, it must be simple to do so. There have been many examples of lenders trying to frustrate the complaints process, and this is not acceptable according to the FCA.
Has this changed things?
It’s clear that brokers, financial advisors and lenders have not always adhered to these principles. You only have to look as far as scandals around PPI, Plevin and unfair contractual relationships, and the brewing concerns about mis-sold mortgages to see this.
Financial institutions have undoubtedly made changes in recent years. However, that’s not to say that other examples of mis-selling and unfair treatment of customers won’t come out of the woodwork.
Many people report that they’ve experienced difficulties when attempting to complain about financial mis-selling to their broker, lender or other financial provider. This can be a complex process, making it difficult for customers who are eligible for compensation to get what they deserve.
If you believe you’ve been mis-sold a financial product, and have found it difficult to get redress from the financial institution, contact our team of solicitors for advice and guidance on claiming compensation.