- By HELEN POW
- From: The Sunday Telegraph
- October 17, 2010
THE worst banks and lenders will be publicly named and shamed by the Financial Ombudsman Service (FOS).
The financial institutions and banks with the most customer complaints for sloppy service, excessive charges or misleading information on products, will for the first time be placed on a public list.
The Ombudsman hopes that by outing the worst offenders, financial firms will improve their service.
"Consumers, the public and the media need to access this information to see who the problem banks are," Consumer Credit Legal Centre principal solicitor Katherine Lane said.
"This sort of reporting is essential otherwise we, the public, cannot scrutinise what is going on and it will just continue.
"We need to know who is worst so we can approach the failing financial institutions and the regulator and ask what is being done."
The FOS received 19,107 complaints in the 2008/09 financial year a 33 per cent spike compared with the previous 12 months.
There was a 33.5 per cent surge in complaints about consumer credit over the year the bulk of which involved home loans and credit cards from 4645 to 6202.
Consumer Credit Legal Centre deals with 16,000 banking complaints each year and another 1000 involving insurance companies.
The centre said it had seen a huge increase in complaints regarding mortgage hardship and repossessions, with National Australia Bank proving the worst offender.
GE Money was also up there in terms of complaints about its interest-free credit cards, which lawyer Katherine Lane said were causing people on low incomes "no end of trouble".
The Australian Bankers' Association chief executive Steven Munchenberg said: "The only reasonable way of doing this, if the FOS has to do it at all, would be to have the number of complaints by institution as a percentage of their total customers.
"Everything we have seen so far gives us real concern that the information will not be fair."
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