A common issue we are identifying in our FAP compliance assurance reviews is a failure to send the required disclosure information to the complainant if a complaint has not been resolved within two working days.

What is required?

After receiving a complaint, the required information must be given to the complainant within two working days, or if not practicable to do so, as soon as practicable after that time. If the complaint is resolved to the complainant’s satisfaction before disclosure is made, then subsequent disclosure is not required.

The complaint disclosure (commonly referred to as stage 4 disclosure) requires the following information to be provided to the complainant:

• An overview of the FAP’s complaints handling process; and
• Prescribed information about the FAP’s dispute resolution scheme.

What is the issue?

The Strategi compliance assurance reviews are identifying that most FAPs have in place a complaints disclosure template. However, a lack of process and implementation of the process are causing the issue, and this results in numerous instances where the disclosure is not sent at all or it is sent way too late.

How to fix the issue?

• Training: Provide training to all those who give regulated financial advice plus to all admin staff on what is a complaint, how and where to record the complaint, where the templates are found and how to ensure the complaints disclosure information is sent on time.
• Responsible individual: Appoint an individual within the business to ensure the complaints register is checked and the complaints disclosure is made on time.
• Update the complaints register: Ensure the complaints register lists the date of the complaint when it was resolved and include when the complaints disclosure was sent to the complainant.
• Automate: If possible, build into your software the ability to provide a task to send the complaint disclosure two days after the complaint is received – assuming it was not resolved beforehand.
• Add to your compliance assurance plan: Your compliance assurance plan will have regular compliance checks which need to be undertaken. Make sure this includes a check of when the complaint disclosure is to be sent.

Remember that the Strategi team are here to help. We can provide Guidance Notes, templates, training and a virtual compliance officer process to support FAPs to ensure complaint disclosure is made. Contact us if you have any questions.