The FSB published guides for small FSPs and asset managers on the practical impact of treating customers fairly (TCF) on their businesses.
The harsh reality of TCF is, of course, that you could be ticking all the right boxes as far as FAIS is concerned, yet fail to deliver a fair outcome for your client.
The following example, from the FSB Guide, provides an idea of what is required in terms of your complaints handling process to ensure that it meets the FAIS and TCF requirements:
An FSP is required to maintain an internal complaint resolution system:
- This system and procedures must be documented
- It must be based upon a complaints policy, which outlines a comprehensive procedure for complaints resolution.
The procedure needs to be transparent so that clients have full knowledge of how their complaints will be resolved.
The procedure should also be easy to use so that clients can lodge complaints using convenient communication systems.
Most importantly, the resolution procedure should be fair to the client, the FSP and staff.
The guide then provides an exhaustive breakdown of what the complaints resolution policy and procedures should contain from a FAIS perspective, and concludes:
When looking at complaints from a TCF perspective it needs to take into account what the FSP does with the information gathered from complaints:
- Is the complaint reviewed and value derived from it?
- Is the information used to prevent similar complaints (identify the cause of the complaint), identify how clients in a similar position will be affected, identify whether you are promoting the right products, etc; or
- Is the complaint dealt with and the information that could be gathered from the complaint ignored?
Complaints resolution is of course only one of many documents you are required to have in place, and review regularly.
It may be a good starting point to look at what is outlined in the FSB Guide regarding your current practice in this regard, and then use this experience for other policies and procedures in your practice.
Click here to download the FSB Guide for small FSPs.
There is also a TCF guide for Asset Managers.