Guernsey's Commerce and Employment Department has issued a Consultation Paper regarding the proposed Financial Services Ombudsman Scheme for Guernsey and Jersey.
The proposed FSO scheme would provide an independent dispute resolution service to settle complaints between consumers and businesses providing financial services in Guernsey and Jersey with a view to providing independent redress as appropriate for that customer.
The scheme, as envisaged by the Consultation Paper, will cover all activities that are regulated and supervised by the GFSC and in addition, consumer lending and personal pensions. Businesses which provide consumer credit will be subject to the scheme regardless of whether they are regulated by the GFSC.
Complaints, which will be subject to a time limit specified in the legislation, will be considered within the scheme's jurisdiction and the Ombudsman can seek to mediate a resolution between the parties. The Ombudsman would also be empowered to investigate and make a determination on the complaint based on what is fair and reasonable in all the circumstances.
For complaints upheld in full or in part, monetary awards may be payable to the complainant by the financial services provider or directions to the financial services provider may be included. Determinations would be enforceable through the Royal Court and it is proposed that there will be no appeal against the Ombudsman's decision for financial services providers.
The scheme would only be open to those for whom using the courts is not a viable option, such as individuals, small businesses and charities. It is proposed that the scheme be funded by the financial services industry with the start-up budget being raised by an initial levy on financial services providers. An outline approach for funding the Scheme is for a graded-fee for certain sectors, with a flat fee for providers that deal with consumers/ personal customers in other areas. Initially it is intended there will be no charge for consumers, however a nominal fee may be introduced to deter repeated or vexatious claims.
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