Surging numbers of complaints about financial products are coming from professional representatives rather than customers themselves, according to watchdogs.
The Financial Ombudsman Service (FOS) reported that complaints to it jumped 70 percent between April and June compared to the same period last year.
Consumers registered 74,645 cases about financial products with the FOS in the three months to 30 June this year, compared with 43,953 complaints over the same time in 2023.
And those coming from customers' representatives – such as claims management companies – now account for around half of the complaints received.
This compares to just 17 percent coming from professionals in the first three months of 2023/24.
Credit cards were the most complained-about product, totaling 18,175 complaints. Most of these (15,580) were about irresponsible and unaffordable lending. Of this figure, more than half were brought by professionals such as claims managers.
The FOS has expressed concern about mass claims submitted by some representatives, particularly those who fail to respond to evidence requests, which hampers investigations.
The ombudsman warned that using a professional representative – who the customer is paying for – does not necessarily lead to a more positive outcome than going directly to the ombudsman – which is free.
It said the latest data showed only 25 percent of claims brought by professional representatives were upheld, compared to 40 percent of those brought directly by consumers to the ombudsman.
The ombudsman has been consulting on a proposal to make professional representatives pay a fee for bringing cases. It will give an update in the coming months.
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Abby Thomas, the chief ombudsman, said: “While professional representatives have an important role to play, they must ensure that their cases are well evidenced and have merit.
“If consumers have a dispute with their bank or finance provider they can come directly to our easy-to-use service for free and we will see if we can help.”
The FOS said professional representative complaints centered on unaffordable lending or motor finance.
Hire purchase was the second most complained-about product, with 15,925 complaints, of which around three quarters related to motor finance commission. More than 90 percent were brought by professional representatives.
Earlier this year the Financial Conduct Authority (FCA) said it was carrying out a review of motor finance “discretionary commission arrangements”.
