Published by: Financial Conduct Authority
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Key Take Aways
The current redress framework effectively handles individual complaints but struggles with mass redress events involving large volumes of complaints and systemic harm.
Increasing complaint volumes, particularly from professional representatives, can overwhelm firms and the Financial Ombudsman, leading to delays, increased costs, and potential disorderly firm failures.
Greater collaboration between the FCA and Financial Ombudsman is planned to improve early identification and management of issues with wider implications (WWI), with a focus on cooperation frameworks like the WIF.
There is a proposal to potentially define what constitutes a mass redress event to enable earlier detection and intervention to prevent systemic issues from escalating.
The use of outcome-focused regulation, such as the Consumer Duty, introduces interpretative challenges that could contribute to redress events without cleare...
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