Regulators letting down consumers over complaints, says LSB

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By Legal Futures

2 March 2011

Kenny: regulators need to identify and measure systemic issues

Frontline regulators are letting down consumers by failing to collect information on how lawyers are handling complaints, a review by the Legal Services Board (LSB) has concluded.

In an assessment of first-tier complaints-handling, published yesterday, the LSB said: “Approved regulators have generally had poor first-tier data collection processes and systems in place. This would make it difficult for them to identify systemic issues and adopt a targeted approach to regulation.”

It continued: “We are concerned that [they] do not have firm plans to collect information about consumer-client satisfaction with complaints-handling… It is difficult to see how they can assess whether consumers consider that the outcomes are being achieved.”

But the LSB said overall most approved regulators have been “proactive” and have “made positive progress” in ensuring effective complaints-handling procedures are in place, including providing information on how to complain to the legal ombudsman.

LSB chief executive, Chris Kenny, said it is “important that regulators are able to gather information in a way that can identify and measure systemic issues in the market. Such data enables us to make sure that regulation is properly addressing emerging areas of consumer detriment.”

Dianne Hayter, chairwoman of the Legal Services Consumer Panel, said the LSB’s findings are “worrying”. She added: “Without this information, it is difficult to see how they can really know what problems consumers are experiencing and take the necessary steps to tackle them.”

Meanwhile, the LSB has announced that it plans to carry out its own consumer research in the first half of 2011, which will “develop a baseline understanding of consumer satisfaction with first-tier complaints handling against which we can measure change”.

In a separate development, LSB chairman David Edmonds has written to Bar Standards Board (BSB) chairman Baroness Deech in light of press reports which suggested “a degree of misunderstanding on your part” about the requirements on barristers to notify clients about their right to complain to the Legal Ombudsman.

There have been objections from barristers about the practicality of doing this in certain circumstances. But Mr Edmonds said in his letter that whilst the board recognised there are a “limited number of cases where it may be difficult for a barrister to contact a client direct… our teams established that, in fact, the requirements currently in force are not substantially different from what was required of barristers previously”.

The LSB provided the BSB with an example of a flyer that barristers could provide to clients, but Mr Edmonds said it was wrong to describe it as “the LSB’s proposal” or that the board was “insisting” on it. He said: “Achieving effective complaint-handling is a good example of how outcomes-focused regulation can provide better results for consumers than strict rules: we would not want to prescribe a particular approach.”

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