The Financial Services Ombudsman Scheme for the Isle of Man - an explanatory guide

What is the Financial Services Ombudsman Scheme?

The Financial Services Ombudsman Scheme is a free, independent dispute resolution service for customers with a complaint against an Isle of Man financial firm such as a bank, insurance company or financial adviser. If the complaint is upheld, we aim to put you in the position you would be in if things hadn't gone wrong. The Scheme can direct the firm to put things right, including paying up to £100,000.

The Scheme is set up under sections 21A, 21B and 21C of the Financial Supervision Act 1988 and operates out of the Isle of Man Office of Fair Trading. It is funded by the Isle of Man Government.

Who can use the Ombudsman Scheme?

Private individuals who are customers of financial firms. Companies are not eligible to use the Scheme.

What can be complained about?

You can bring a complaint if, in the course of supplying you with financial services, a firm has caused you to lose money (or suffer material distress or material inconvenience) through its maladministration or negligence. Financial services include insurance, investments, banking, mortgages and credit as well as pension and other financial advice. The Pensions Ombudsman covers complaints about the administration and running of personal and occupational pension schemes. You should first approach the Pensions Advisory Service.

Are there any time limits?

There is an overall 'starting point' whereby the Scheme can only consider complaints relating to acts or omissions that took place on or after 20th April 1999.

You must bring a complaint to the Ombudsman Scheme within six years of the act or omission that led to your complaint, and within two years of when it should have come to your notice, if you weren't aware of it immediately.

Are there any geographical restrictions?

The financial services must have been supplied by a firm (a 'supplier') operating in or from the Isle of Man but the customer can be based anywhere in the world.

If your complaint concerns financial services provided in or from the UK, you should approach the UK Financial Ombudsman Service.

What can't be complained about?

We cannot investigate any complaints relating to suppliers who are not based in or operating from the Isle of Man.

We may decide not to take on a complaint if:

you have not suffered financial loss, material inconvenience or distress
we think the supplier has already made a fair offer of compensation
the complaint has or is being considered by any court or another dispute resolution scheme
we think it is a frivolous or vexatious complaint

We cannot consider complaints about the legitimate exercise of the supplier's commercial judgement (for example in deciding whether or not to offer credit) or about investment performance unless the supplier has been negligent in some way.

Awards

If the Adjudicator decides to uphold your complaint, s/he can order the supplier to take the necessary steps to put you in the situation you should have been in, had the supplier acted correctly. This can take the form of a money award of up to £100,000 and/or action by the supplier.

In exceptional cases the Adjudicator can make awards (of small sums) if you have suffered distress or inconvenience, or for professional services such as surveyors' or doctors' reports where necessary. However you should not assume that an award will be made for any legal costs incurred.

Awards are binding on both parties, which means that the supplier has to follow the decision of the Adjudicator. It also means that you cannot take your complaint on to court if you are dissatisfied with the outcome. If you or the supplier thinks the Adjudicator has made a mistake in their consideration of the legal situation, you can appeal to the High Court.

This page aims to explain how the Financial Services Ombudsman Scheme operates, for full details please refer to the legislation. 06/2003

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