Jersey’s first Financial Services Ombudsman will begin investigating and resolving complaints on November 16 2015.

Once the ombudsman scheme is in operation, the ombudsman will adjudicate complaints from individual customers in relation to financial services provided in Jersey and will be able to make awards to return complainants to the position that they would have been in had the problem not occurred.

Complaint structure

Who can complain?

1. Certain categories of person are eligible to complain to the ombudsman, including individuals, small businesses, charities, trusts and foundations.
2. The service will be primarily available to persons that lack the resources or expertise to use other means in order to resolve complaints.
3. The service will be available to complainants resident anywhere, not just to Jersey residents.

What can complaints be about?

1. Complaints are restricted to acts in the course of relevant financial services business provided within Jersey.
2. ‘Relevant financial services business’ is defined broadly. However, certain classes of business that will not be covered by the ombudsman have been exempted by order.
3. The Financial Services Ombudsman (Exempt Business) (Jersey) Order 2014 came into force November 25 2014. It exempts all business except for:
   1. deposit-taking business;
   2. money service business;
   3. the business of a functionary relating to a recognised fund;
   4. general insurance mediation business;
   5. insurance business;
   6. investment business;
   7. pension business;
   8. credit business; and
   9. ancillary business relating to the above.
4. Under the order, most trust company business (except that relating to business as listed above), occupational pensions and fund business relating to funds other than recognised funds are outside the scope of the scheme.
5. When must complaints be made?
   1. A complaint must be made to the ombudsman within six years of the act to which it relates or two years after the complainant should have become aware of the cause for complaint. The complaint must relate to an act that occurred after January 1 2010 and the financial services provider must have been given a reasonable opportunity (capped at three months) to consider the complaint.
   2. However, a shorter time limit will apply, so that a complainant must refer the complaint to the ombudsman within six months of receiving a final response on the complaint from the financial services provider if the provider meets certain requirements for handling complaints. For the shorter limit to apply, the provider must notify clients of the availability of the ombudsman scheme and the six-month time limit. This shorter time limit is likely to mean that financial services providers will amend their procedures accordingly.
6. Awards
   1. In many instances, it is expected that complaints will be resolved without a financial award being made. However, the ombudsman may require that the financial services provider compensate the complainant for its financial loss and any material distress or inconvenience. The maximum amount that the ombudsman can award will be £150,000.
7. Determinations
   1. If the person making the complaint accepts the determination, it is binding. There is no right of appeal, so no further legal action can be taken on the same subject matter, except for judicial review.
8. Funding
   1. The scheme will be free to complainants and will be funded by financial services providers. It will be paid for by levies on financial services providers and by case fees charged to providers in respect of complaints against them.
9. Will Guernsey be involved?
   1. The ombudsman scheme is a joint Jersey and Guernsey initiative. There is a shared single office in Jersey with a shared staff and board.
10. When will the scheme begin?
    1. The ombudsman began his appointment on June 1 2015. The opening date for the scheme is November 16 2015, once the States of Jersey has passed the draft Financial Services Ombudsman (Jersey) Law 2014 (Appointed Day) (3) Act 201-. This will bring the remaining provisions of the Financial Services Ombudsman (Jersey) Law 2014 into force. The ombudsman is preparing guidelines for handling complaints which are expected to be published in the next few months.
11. How to prepare for the scheme
    1. Businesses and individuals should consider whether they would like to take advantage of the six-month time limit for complaints to be made and, if so, be prepared to make amendments to client-facing documents in order to notify clients that the scheme is available and inform them of the six-month time limit. In addition, businesses and individuals should be ready to ensure that their complaints procedures conform to the model procedure for complaints handling once the ombudsman publishes its guidelines.