Complaints to financial ombudsman rise

Complaints to the Financial Services Ombudsman jumped by 15 per cent last year compared with 2006, according to the ombudsman Joe Meade.

In a statement accompanying the publication of the Ombudsman's annual report he said 4,374 complaints were submitted last year and that so far this year his office has received 1,600 complaints, an increase of 17 per cent compared with the same period in 2007.

He said some 59 per cent of claims were resolved in the complainant's favour and 36 per cent of the complaints investigated upheld.

Of the remainder, 46 per cent were not upheld; 12 per cent were outside the statutory remit and 6 per cent were referred either to other agencies.

Joe Meade said 2,445 complaints involved the insurance sector with 857 relating to life insurance products, 1,189 involving non-life products with a further 182 concerning health insurers.

The main areas of complaint were motor, travel, life assurance and investment policies.

Just under 2,000 complaints related to credit institutions with the vast majority, or 1,588 involving banks; 99 relating to building societies and 72 involving intermediaries.

In this category mortgages, account transactions, lending problems and credit card disputes were most frequent cause of complaint.

Mr Meade said the inappropriate selling of investment products to elderly people continues and said he was "disappointed that the issues are of a recurring nature".

One case highlighted his annual report shows that a 86-year-old bachelor farmer sold his farm for €1.4 million and following advice from a bank official he invested €850,000 in two 6-year fixed term insurance bonds which, when he died seven months later were worth €50,000 less than his original investment.

The bank involved was instructed that the €50,000 loss be made good to his estate.

Another case highlighted involved an “unsuitable” €10,000 investment product sold to an unemployed single mother. Mr Meade said that the case led to a questioning of the sales practices of the insurance company involved.

Mr Meade also details the insensitive handling of a repatriation claim by the parents of a deceased tourist which resulted in a £4,500 (€5,597) award to the parents.