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Module 1 · FSRE (Financial Services, Regulation & Ethics)

FRE1Industry, Regulation and Key Parties✓FRE2Skills, Principles and Ethical Behaviours

Module 2 · MORT (Mortgages)

MRT1Mortgage Law, Practice and Application MRT2Mortgage Products and Post Completion

Module 3 · Synoptic case-study exam

ASEW/ASSCAssessment of Mortgage Advice Knowledge (synoptic)

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FRE2 · Skills, Principles and Ethical Behaviours

Complaints, the FOS, the FSCS & Conduct Risk

This part of AC7.2 is all about deadlines and money, so expect calculations. You count business days to a summary resolution deadline, find the eight-week date, test a referral against the six-month, six-year and three-year limits, cap an award at £455,000 or £205,000, and work out an FSCS payout on deposits, joint accounts, temporary high balances, investments and insurance. The scenarios also check that you send the customer to the right body: the firm first, then the FOS for a solvent firm, the FSCS only when the firm is in default. Several figures changed recently: the deposit limit is £120,000 from 1 December 2025, and the FOS limits rose on 1 April 2026.

9 min read6 sections

Checked against: Walbrook (formerly LIBF) FSRE specification v7 (July 2026), FRE2 LO7 AC7.2; FCA Handbook DISP 1, DISP 2.7-2.8, DISP 3.6-3.7, PRIN 2.1, PRIN 2A; FSMA 2000 s228; fscs.org.uk compensation limits; checked 11 Oct 2026. Independent prep, not endorsed by Walbrook (formerly LIBF).

Must-know for the exam

A complaint is any oral or written expression of dissatisfaction, justified or not, alleging financial loss, material distress or material inconvenience (FCA Glossary). No special words are needed.
Summary resolution communication: complaint resolved by close of business on the third business day after receipt (DISP 1.5.1R). It must still give the FOS website and referral rights.
Final response, or a written explanation of the delay, by the end of 8 weeks (DISP 1.6.2R). Enclose the FOS leaflet, website, six-month warning and time-limit waiver statement.
Complaints records: at least 3 years from receipt (DISP 1.9.1R). Complaints returns: usually twice a year, within 30 business days of each period end (DISP 1.10).
Eligible complainants (DISP 2.7.3R): consumers, micro-enterprises, small businesses, charities with income under £6.5m, trusts with net assets under £5m, and guarantors for the guarantee only.
FOS time limits (DISP 2.8.2R): refer within 6 months of the final response; complain within 6 years of the event or, if later, 3 years from awareness.
FOS award limits for complaints referred from 1 April 2026: £455,000 (acts on or after 1 April 2019) and £205,000 (acts before), excluding interest and costs (DISP 3.7.4R).
An accepted FOS decision binds the firm and the consumer (FSMA 2000 s228(5)). A consumer who rejects it can still go to court. The firm has no appeal.
FSCS deposits: £120,000 per person per banking licence from 1 December 2025; £240,000 for a two-person joint account; temporary high balances up to £1.4m for 6 months.
FSCS investments and home finance advice or arranging: £85,000 per person per firm (failures after 1 April 2019). Insurance: 100% for long-term and compulsory, 90% for other general insurance.
The FSCS pays only when a firm is in default. Against a solvent firm, the route is the firm's complaints process and then the FOS.
Where the Consumer Duty (Principle 12, from 31 July 2023) applies, Principles 6 and 7 are disapplied. Conduct risk is the risk that firm behaviour causes poor customer outcomes.

On this page · 6 sections

Traps that cost marks

Thinking a complaint must be in writing or use the word 'complaint'.
Assuming every charity can use the FOS.
Thinking only individual consumers can complain to the FOS.
Giving a guarantor the borrower's full complaint rights.
Counting the day of receipt as day one, or counting the weekend.
Mixing up the contents of a summary resolution communication with those of a final response.
Thinking the customer must always wait for a final response before going to the FOS.
Thinking that mentioning the FOS is enough without the leaflet and website.

What a complaint is and who can take it to the FOS

Under the FCA Glossary, a complaint is any oral or written expression of dissatisfaction, whether justified or not, about a financial service. It must allege that the person has suffered, or may suffer, financial loss, material distress or material inconvenience. An angry phone call about a missed call-back is a complaint. The customer does not have to use the word.

Only an eligible complainant can use the Financial Ombudsman Service (DISP 2.7.3R):

•A consumer.
•A micro-enterprise or small business.
•A charity with annual income under £6.5m when it refers the complaint.
•A trustee of a trust with net asset value under £5m.
•A guarantor, but only about matters relevant to the guarantee (DISP 2.7.5AR).

Trap: A large charity (say £7.2m income) cannot use the FOS, and a guarantor cannot complain about the borrower's product.

Takeaway: Any expression of dissatisfaction counts; FOS eligibility depends on who the complainant is and how big it is.

The DISP timeline

DISP 1 sets a fixed clock from the day the firm receives the complaint. Count business days for summary resolution and calendar weeks for the final response.

Stage	Deadline	What must happen	Rule
Summary resolution	Close of business on the 3rd business day after receipt	Summary resolution communication: complaint resolved, FOS referral rights, time-limit waiver statement, FOS website

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