8 Redress

Abstract

This chapter explores alternative avenues that customers or investors may have for redress against firms. In the first instance, customers are expected to utilize firms’ internal complaints processes. If a customer is dissatisfied with the response he receives at the conclusion of the internal complaints process, the matter may be placed before the Financial Ombudsman Service (FOS). There are both advantages and disadvantages in pursuing a complaint to the FOS. The chapter then describes the Financial Services Compensation Scheme. The compensation scheme provides an important source of recovery for an ‘eligible claimant’ who has suffered loss through the act or omission of an authorised person who is unable to meet the resulting claim for compensation. The scheme therefore provides industry-funded insurance against the risk that a successful civil claim against an authorised person might otherwise prove to be worthless.