The Complaints Commissioner has spoken out against the methods used by the FSA to collect a debt from an IFA firm, according to the Financial Times.
A letter written by the firm to the Commissioner, protesting against the regulatory body’s debt collecting agency, has led to a consultation between the warring parties.
Commissioner Sir Anthony Holland, branded the methods of the quango’s debt collection agency as “hectoring,” after hearing a phone conversation between the agency and the firm.
In a letter responding to the IFA firm, Sir Holland describes the agency’s approach as, “somewhat hectoring…with continual interruptions, which I consider does not reflect well on the FSA”.
The commissioner said: “The call lasted just more than 10 minutes and in my view, was badly handled by the company concerned who, in this case, represents the FSA. While it did not represent harassment it was certainly a conversation that the company should not have allowed to develop in the way it did.”
The debt itself refers to fees owed by the firm to the FSA, and concern the year 2009/2010. However, the firm believes this to be unjust as they had already informed them that they were closed for business as of August 19.
The firm shut for new business after a provider suddenly failed to renew commission payments. The firm believes it should have been charged on a pro-rata basis, from the 1 April to 18 August.
Pointing to paragraph 4.2.9 in the FSA Fees Handbook, the Commissioner insisted the FSA was within its right to collect the payment, but questioned its methods all the same.
As a result, following a consultation between the warring parties, the FSA has agreed to allow the firm to repay the debt in affordable instalments, as based on the IFA’s limited income.
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