The Financial Conduct Authority has named a new interim chair of the Financial Ombudsman Service after its initial recruitment campaign “proved unsuccessful”.
The City regulator appointed Liam Coleman as the watchdog’s temporary chair, which comes as controversy surrounds the departures of former leadership.
Coleman will replace Baroness Zahida Manzoor who abruptly announced in February she would exit the regulator at the end of her second three-year term in August.
Manzoor’s intention to leave came days after the unexpected departure of the FOS’ chief executive Abby Thomas.
In a Treasury Committee hearing in February, Manzoor refused to explain Thomas’ departure, citing a “mutual agreement”.
A report released earlier this month blasted the Manzoor’s “disrespectful” actions for obstructing scrutiny.
The committee’s report concluded Thomas’ departure was due to “fundamental disagreements” between the former chief and and board of directors.
FOS faces Treasury overhaul
The finance quango has been a central target of the Treasury’s regulatory reform after facing criticism of being a “quasi-regulator”.
Chancellor Rachel Reeves’ Leeds Reforms confirmed a crackdown on the watchdog with aims for it to “be returned to its original purpose as a simple, impartial dispute resolution service”.
Complaints to the watchdog neared PPI heights in the last year after a surge in motor finance grievances and a rise in professional representatives increased the regulator’s caseload by over 50 per cent.
City banking giants are set to hear the Supreme Court’s ruling on the motor finance scandal this Friday, but have argued the FOS was given too much power over handling complaints.
The latest hike in complaints figures came ahead of the regulator beginning to charge professional representatives £250 for each case referred beyond the first ten per financial year.
Coleman, a former chief of The Co-operative Bank and Treasury group director at Nationwide, will take up the role on 10 October.
He said: “I am honoured to take on the role of interim chair at the Financial Ombudsman Service. It plays a vital role in upholding fairness and trust in the financial system.
“I look forward to working closely with the board, executive team, and our wider stakeholders – including the Treasury and the FCA.”