UK Financial Ombudsman reports no foreign currency enquiries received from consumers in April-June 2017

Maria Nikolova

Enquiries about spread betting products & services rose 20% from a year earlier, whereas those about derivatives fell by nearly 37%.

The UK Financial Ombudsman Service reports no enquiries about foreign currency products & services were received from consumers in the quarter from April 1, 2017 to June 30, 2017, according to the latest statistics published by the body today.

The zero such enquiries for the period in question compare to 252 foreign currency enquiries received during the whole year to March 31, 2017. Of these, 26 were referred to an ombudsman for a final decision and the rate of complaints upheld in favor of consumers was 36%.

During the April-June 2017 quarter, the number of spread betting enquiries received was 66, up 20% from the 55 enquiries received by the Ombudsman in the corresponding quarter a year earlier. The number of complaints referred to an ombudsman was 37 in the three months to June 30, 2017. The portion of complaints upheld in favor of consumers, however, was relatively low at 15%.

Regarding derivatives, the Financial Ombudsman received 50 enquiries in the April-June 2017, down by nearly 37% from the same period in 2016. The number of complaints referred to the ombudsman was 39, with the percentage of complaints resolved in consumers’ favour being 28%.

In the meantime, filing a binary options complaint remains somewhat of a grey area for consumers in the UK. Earlier this year, FinanceFeeds contacted the Independent Betting Adjudication Service (IBAS), a major ADR body for the gambling sector, set up in 1998. Richard Hayler, Managing Director at IBAS, has kindly agreed to help us clarify where binary options disputes stand in the overall ADR picture.

“I have read a number of stories about binary options fraud, but as yet I haven’t seen any cases relating to it reach IBAS”, Mr Hayler said.

According to a report by the UK Financial Conduct Authority (FCA) for the period from December 1, 2015 to November 30, 2016, binary options were the type of investment products that saw the most growth in enquiries. Binary options accounted for 17% of enquiries within investment products. Consumers have been contacting the FCA mainly to verify whether firms offering binary options are regulated.

The Markets in Financial Instruments Directive (MiFID) II, which will apply from January 3, 2018, means that certain binary options will be regulated by the FCA rather than the Gambling Commission.

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