Commentary on Investment Dealer complaint handling
People often complain about Dealer complaint systems because they can be complex, time-consuming, and frustrating, leading to perceived lack of resolution or responsiveness.
Based our experience in assisting complainants , here is a breakdown of common complaints about complaint systems:
1. Complexity and Lack of Clarity:
Difficult Navigation:
Many systems are poorly designed, making it hard to find the right channels or information. .
Confusing Processes:
The steps involved in filing and resolving a complaint can be unclear, leading to frustration and wasted time/effort.
Lack of Accessibility:
Systems may not be accessible to all users, such as those with disabilities , language issues, lack of internet or limited tech skills.
2. Inefficiency and Delays:
Long Wait Times:
Getting a response or resolution can take an unreasonable amount of time, causing further frustration. Dealers offer non-independent internal appeal mechanisms which needlessly add to cycle time.
Lack of Timely Updates:
Complainants may not receive adequate updates on the status of their complaint, leaving them feeling in the dark.
Unnecessary Escalation:
Simple issues may require unnecessary escalation to higher levels, further delaying resolution and adding to aggravation “ complainant fatigue”.
3. Lack of Resolution and Fairness:
Unsatisfactory Resolutions:
Complaints may be dismissed or resolved in a way that does not address the underlying issue or provide adequate compensation for losses.This is far too common .
Perceived Bias:
Complainants may feel that the system is biased towards the Dealer they are complaining against. This is a frequent complaint with evidence from employees prioritized over that provided by complainants. There also attempts to divert complainants away from OBSI.
Lack of Accountability:
There may be a lack of accountability for the Dealer or individuals involved in the complaint. More senior management is needed
4. Other Common Issues:
Inadequate Documentation:
Systems may not provide clear and accessible documentation about complaint procedures or rights. Loss calculation methodology not publicly available
Poor Communication:
Communication with complainants may be infrequent, impersonal, legalistic , disrespectful or unhelpful.
Lack of Transparency:
The process of handling complaints may not be transparent, making it difficult for complainants to understand Dealer responses
Focus on Form over Function:
Systems may prioritize paperwork and procedures over actually addressing the issues raised by complainants. Too often a PR exercise.
All in all, a very difficult process for the average retail investor to navigate. Regulators need to provide a modern complaint handling rule for Dealers to adhere to.
