How to deal with a client complaint

A COMPLAINT IS A COMPLAINT!

I do not know how much experience Mr Whitmer has in this industry but if he has been quoted correctly then some of his comments are at best naive or poor practice and certainly potential breaches of the FSA Rules. He says "all complaints should be dealt with in person, or over the phone, rather than by letter or email." “Letters and emails are dangerous territory for handling complaints because if you reply in this way, they might misconstrue that you don’t care and you’re not interested,” he says. I disagree. A formal response is a clear indication that you ARE taking the complaint seriously. “If they have got a legitimate complaint ........ you have got to let them spill it all out [in person], so you can address the situation.” That sounds to me like an attempt to talk someone out of making a complaint -poor practice if ever I heard it. It is important to distinguish between a telephone enquiry about the performance of an investment, for example, and a complaint about the advice given. A complaint is a complaint whether you receive it by telephone or email or letter. You can ask a telephone complainant to put their complaint in writing but either way you are obliged to acknowledge the complaint and issue your Complaints Procedure (do you have one Mr Whitmer?) within 5 business days and reply within 4 weeks or 8 weeks if there is a good reason for the delay. I have received 8 complaints in nearly 25 years in business; all have been in writing; only one was preceded by a phone call and that was more than 20 years ago; none were successful. As Harry Katz says the way to avoid successful complaints is always to fully document your advice and always give full risk warnings preferably in bold print. I have never had a client reject my advice because of a risk warning.

Posted by: ALAN S HARRIS

Complaints

The complaints handling advice from Messrs Witmer, Kelly and Lakey as reported in this article may collectively sound to be common sense but, unfortunately, that may well lead you right down the wrong path. It is certainly not what I would advise. I have acted for IFAs for 11 years as respondents in consumer complaints, and over the last 3 years have undertaken a number of “class action” complaints on behalf of consumers as complainants. I am currently handling about 200 various complaints both for and against IFAs. I agree that avoiding complaints is as much to do with managing the client and their expectations before during and after the advice process as it is to do with ensuring the suitability of advice in the first place, but once a complaint has been made then its outcome may be influenced by how you deal with it. A complaint is a complaint is a complaint whether it is informal or “full blown” and whether it is about you, your advice, the product or its performance and whether it is made verbally or by email or in writing. And they should all be logged in your complaints registers. I am acting for two IFAs just now in various stages of investigations where the FSA allege that they are in breach of the rules for failing to follow their complaint procedures. In one case, the IFA decided it was just a “query” and dealt with it by phone. In the other, the IFA had a conversation with the client and then wrote to him on personal basis expressing his personal disappointment that the client should have complained. It is obviously crucial that you analyse what the complaint is really about to determine how you address it and respond to it – but whatever you do it is folly to respond to it verbally. If ever there were a medium for a consumer misinterpreting what you say, whether that be due to selective memory or not, it is the spoken word. Of course, an email or letter may be misinterpreted but you have time carefully to craft what you say to minimize the scope for misunderstanding or deliberate misinterpretation. As soon as you have received a complaint – irrespective of the medium or the subject – write to the client confirming that you have logged it as such and state that you will investigate. Tell the client that FSA rules provide that you must issue a final decision within 8 weeks but state that if it is a complicated matter you may ask the client to allow you further time. And write to the client periodically to state where you are with your investigation. Keep the client informed. I agree that it is essential that you do not take the complaint personally – if you have a compliance officer in your firm then he/she must deal with it. If not, then get one of the other advisers or directors in your firm – you should have someone identified as the complaints officer - and tell the client who in your firm is dealing with it and why. Once you have identified what the complaint is about, you should write to the complainant – a real old fashioned letter, not an email – and outline what it is you understand the complaint to be absolute and ask the client to confirm that. When you have investigated the complaint, take time to craft the response. It is a requirement that you add to the response the warning that the complainant has 6 months from the date of the response to raise a complaint with the FOS, whose details you must give. Handling complaints is not easy – and handling them the wrong way simply makes a bad situation worse. if you ewant advice contact me at Financial Services Advocacy - alasdair@fsalawyer.co.uk

Posted by: Alasdair Sampson

Problem Resolved same day

If a client writes in stating they wish to complain (I hjave had one in 13 years and thatw as via a solicitor), then the person is truly agrieved and the matter needs to be resolved properly and your complainst procedure needs to kick in. A client should not have to write a letter of complaint if they phone and express concern, but sometimes it is difficult to ascertain if the client actually has a problem with something you have done if they phone up. I have just sat the CII's R01 "Regulation adn Ethics" and page 6/17 states "A complaint for this purpose is any expression of dissatisfaction, whetehr oral, or written and,whether justified or not, alleges that the complainant suffered financial loss, material distressor material inconvenience" while on page 6/18 is also goes on to say "Note that rules regarding time limits do NOT apply to complaints which do not involve an allegation that the complainant has suffered, ormay suffer, financial loss, material distress or inconvenience, or where the complaint has been resolved by close of business the day following it's receipt. These types of complaint are also not subject to the record keeping rules" Needless to say, the written complaint I received complaining that my former business partner and I were NOT wearing ties in the newsletter we sent was handled by close of business the following day by a phone call and as a result is NOT the one complaint I have had in 13 years!

Posted by: Phil Castle