New quarterly data today from the Financial Ombudsman Service has revealed a 70% jump in financial complaints, with nearly half of all complaints from professional representatives including claims management companies (CMCs).

The FOS reported a “significant” rise in financial complaints brought by professional complaint handlers.

Complaints from professional representatives, such as CMCs, have soared in recent years.

Complaints rose to 74,645 in the first quarter of the FOS’s financial year (April to June 2024), up 70%.

Despite the rapid rise in complaints from professional representatives, the FOS said complaints from these sources did not necessarily yield a better result for consumers.

In a statement the FOS said: “Using a professional representative does not necessarily lead to a more favourable outcome. Today’s data demonstrates that, in quarter one of this financial year, only 25% of claims brought by professional representatives were upheld, compared to 40% of those brought directly by consumers to the Ombudsman for free.”

The influx of complaints seems to changing the make up of complaints with submissions on credit cards now the highest number overall.

The number of complaints about credit cards in the quarter topped 18,000 compared to just over 4,000 in the same quarter the previous year. These were followed by complaints about higher purchase for motor cars and current accounts, both up sharply.

Complaints about investment products and SIPPs were relatively stable over the quarter. There were 147 new complaints about standard investment SIPPs with an uphold rate of 39% compared to 155 new complaints and an uphold rate of 45% in the same quarter last year.

On the investment side the number of complaints in the quarter about stocks and shares ISAs rose year on year from 287 to 339.

The FOS has been consulting in recent months on a proposed case fee for professional representatives and plans to issue an update on its proposals in the coming months.

Abby Thomas, chief executive and chief ombudsman of the Financial Ombudsman Service, said: “It’s concerning that we’re continuing to see large volumes of complaints, particularly considering the cost-of-living crisis.

“It’s vital that businesses are open and transparent with their customers, treating them with fairness and understanding. Whilst professional representatives have an important role to play, they must ensure that their cases are well evidenced and have merit.”

She said most complaint issues brought by professional representatives relate to either irresponsible and unaffordable lending or motor finance. The vast majority of credit card complaints - 15,580 - were about perceived irresponsible and unaffordable lending. Of this figure, over half were brought by professional representatives.

Hire purchase (motor) was the second most complained about product, with 15,925 complaints, of which around three quarters are in relation to motor finance commission. Over 90% of these motor finance commission complaints were brought by professional representatives.