Edell seeks more power: Building Society Ombudsman says many complaints outside his remit

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The Independent Online
STEPHEN Edell, the Building Societies Ombudsman, yesterday called for wider powers of investigation in the face of mounting complaints about issues he is currently barred from investigating.

At present the ombudsman cannot look into any problems relating to events before a mortgage or investment is made.

Mr Edell is proposing that all complaints about dealings that result in a mortgage or investment should come within his ambit. Those relating to inquiries where the customer does not proceed would still be excluded as this would entail societies having to keep records about every casual request for information.

The Building Societies Association is due to discuss the idea next month. It is not a foregone conclusion that it will agree to widen his jurisdiction.

The call comes as the scope of the Insurance Ombudsman's powers is being reduced. This follows a legal ruling that limits his right to look at complaints centred on mortgages, but involving an insurance policy such as home income plans sold to the elderly, a common source of disagreement.

The Building Societies Ombudsman has the voluntary agreement of nine societies including the Halifax and Cheltenham & Gloucester to investigate home income cases. But nine societies have refused to join in. 'This is not satisfactory,' said Mr Edell, who has been joined by another ombudsman, Brian Murphy.

There are also problems over investigating complaints about valuations and surveys and mortgage protection insurance. The latter was the subject of the case that brought the highest award in 1992-3 - pounds 22,500. The society arranged cover to start at the beginning of the month after the mortgage began and cover was excluded for unemployment for the first 90 days. The customer did become unemployed more than 90 days after the start of the mortgage, but less than 90 days after the start of the policy.

The ombudsman said the society should have arranged for cover to begin on the day the mortgage was completed and ordered it to pay the amount that would have been paid by the insurance company, plus compensation and some costs.

The number of initial complaints fell from 9,525 to 9,402, with 4,859 relating to mortgages. The number of cases dealt with rose from 7,589 to 9,255.

(Photograph omitted)

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