Scam warning as watchdog issues grim forecast for Britons over next 12 months | Personal Finance | Finance

Financial watchdogs have revised up the number of complaints they expect to handle this year by 16 percent amid a scams epidemic.

The Financial Ombudsman Service (FOS) is seeing a rise in the number of complaints around fraud and scams.

At the same time, there are more complaints around rip-off commissions charged on car loan agreements and credit cards.

There are also rising concerns around unaffordable lending, where organisations have granted credit to individuals without making proper checks on their ability to make repayments.

FOS has revised the number of complaints it expects to see during 2024/25 from 181,300 to 210,000.

The Chief Executive and Chief Ombudsman at FOS, Abby Thomas, said: “In the year ahead it’s likely that our service will see increasing levels of complaints, with many of those disputes expected to focus on the critical issues that impact people’s everyday lives.

“This includes perceived unaffordable lending, concerns about car-loan agreements and disputes around fraud and scams.”

FOS is expecting 149,200 banking and credit complaints, of which 13,900 will be about motor finance commission.

Separately, is expecting 47,400 insurance complaints, of which 18,700 will be about motor insurance. On top of that is predicts 12,800 investment and pensions complaints.

FOS was set up by Parliament to resolve individual complaints between financial businesses and their customers on a fair and reasonable basis, as a free alternative to the courts.

It plans to recruit more case handlers to tackle the increased workload.

The organisation, which has been criticised for the time it takes to resolve complaints, has committed to resolve 17 percent more cases in the year ahead than in 2023/24, up from 192,500 to 225,000.

It has also set itself a new target of resolving 90 percent of cases within six months.

The FOS has also confirmed its intention to reduce the cost of its services to industry in 2024/25.

Case fees will also drop by £100 per case to £650, while levies imposed on businesses will also be reduced.

This will result in an effective £60m reduction in case fee and levy costs to businesses, once inflation and increases in the number of cases are taken into account.