FSCS to pay small claims without investigation

clock

The Financial Services Compensation Scheme (FSCS) will be able to make small claims payouts without even investigating the eligibility of claimants, under rules confirmed by the Financial Services Authority (FSA).

Confirming proposals set out in a consultation paper in March, the rule will allow the FSCS to pay compensation without a full investigation if the costs of investigation are disproportionate to the benefits. The FSA has pressed ahead with the plan despite the fact that half of respondents to the consultation opposed the move. Among the objections were that the rule could end up being applied to large, complex claims, while there were also fears that it could be "a charter for claims management companies and people making spurious and fraudulent claims". However, the FSA stressed t...

To continue reading this article...

Join Professional Adviser for free

  • Unlimited access to real-time news, industry insights and market intelligence
  • Stay ahead of the curve with spotlights on emerging trends and technologies
  • Receive breaking news stories straight to your inbox in the daily newsletters
  • Make smart business decisions with the latest developments in regulation, investing retirement and protection
  • Members-only access to the editor’s weekly Friday commentary
  • Be the first to hear about our events and awards programmes

Join

 

Already a Professional Adviser member?

Login

More on Regulation

British Steel scandal 'illustrates scale of the redress problem'

British Steel scandal 'illustrates scale of the redress problem'

FCA and FOS joint call for input is ‘necessary’

Isabel Baxter
clock 06 December 2024 • 4 min read
Consumer Duty Alliance launches tool to help advisers 'stay ahead of FCA'

Consumer Duty Alliance launches tool to help advisers 'stay ahead of FCA'

Following calls from members looking to further evidence assessment

Isabel Baxter
clock 04 December 2024 • 2 min read
Next steps 'coming soon' for FCA's ongoing advice services review

Next steps 'coming soon' for FCA's ongoing advice services review

Regulator ‘concerned’ that clients are paying for services that are not being delivered

Isabel Baxter
clock 27 November 2024 • 2 min read