The plenary will take place in Malta , oganise by Malta Financial Services Autority (MFSA) member of FIN-NET.

The Union of Banking Mediators is a member candidat of FIN-NET, the European out-of-court network for the resolution of disputes between consumers and financial services providers.

FIN-NET is a network established by the European Commission in February 2001. It links 50 out-of-court Alternative Dispute Resolution (ADR) schemes that deal with complaints in the area of financial services and covers the European Union, Norway, Iceland and Liechtenstein (European Economic Area – EEA).

The rationale for the creation of FIN-NET is to provide customers with easier access to out-of-court complaint procedures in cross-border cases, thus facilitating the market in cross-border financial services.

Members of FIN-NET are linked through a Memorandum of Understanding which outlines the mechanisms and other conditions to which members shall abide in order to facilitate out-of-court settlement of cross-border disputes.

All FIN-NET members are required to comply with the principles applicable to the bodies responsible for out of court settlement: these are set out in Commission Recommendation 98/257/EC of 30 March 1998. Adherence to this recommendation is particularly important since the structure, nature and competence of different FIN-NET members vary.

FIN-NET needs to be put in the broader context of the level of cross-border transactions in the financial services sector.

Where a financial services provider sets up a network of branches in different countries, normally the consumer will be contracting with a local branch and this will not be a cross border transaction.

Studies have indicated that the level of cross border transactions which fall within the scope of FIN-NET is small, normally less than 1% of total transactions.

FIN-NET provides its members with an appropriate mechanism for sharing experiences and exchanging information, which also has a positive effect on the complaints handling procedure.

This is primarily based on the two semi-annual meetings that allow networking among FIN-NET members but also provide information on recent developments at the European and national level.

The networking of ADRs is an important benefit for the Consumer Complaints Unit because it is evident that a number of complaints made by Rumanian consumers are fairly similar to those made by other European counterparts.


In the execution of its functions,  the Union Banking Mediators is committed to follow the following principles:

1. Independence

The Union of Banking Mediators  seeks to provide an impartial service which is accessible and freely available to the general public having complaints against financial entities and their services;

2. Transparency

The Union of Banking Mediators  ensures that consumers have all the information necessary about the procedures for handling their complaints on financial services transactions;

3. Adversorial

The Union of Banking Mediators ensures that the complainant, the financial entity and any other party interested in the complaint are given an opportunity to make representations.
The Union Banking Mediators has to inform the parties about the progress achieved;

4. Effectiveness

The Union of Banking Mediators  ensures that private consumers will benefit from the advantages of the consumer complaints handling procedures, i.e.:

i) access without being obliged to seek professional advice;
ii) low-cost service;
iii) a procedure which ensures minimum bureaucracy, no undue delays and which does not deprive the consumer of the protection afforded by consumer protection legislation or to bring an action before the courts for the settlement of the dispute;

5. Legality

The Union of Banking Mediators  ensures that the recommendation of the Union Banking Mediators does not result in the consumer being deprived of the protection afforded by the mandatory provisions of national legislation;

6. Liberty

The Union of Banking Mediators  ensures that any recommendation made by same is not binding on either the complainant or the financial entity. Therefore the parties to the complaint are not prohibited from resorting to court action for the settlement of the dispute;

7. Representation

The  Union of Banking Mediators  ensures that the parties to the complaint have a right to be represented or assisted by a third party during all stages of the complaint review process.



The Union of Banking Mediators is composed of a president, vice president and general secretary. Union is independent of the Mediation Council as regulator and control of mediation in Romania and of the banking system


Financial services are based on trust. However, one must distinguish between trusting blindly and trusting cautiously. It is easy but unfair to generalise on the way many financial products or services are offered to local consumers.

Similarly it is not fair to take the number of complaints received by the Ministry of Finance as representative of the way financial transactions are conducted in specific areas of financial services.

The fact that many financial products are sold, rather than bought, is not far from the truth. The same can be said for the fact that many consumers do not read the contracts which they sign.

As long as things do not go wrong, there is no cause to complain. Furthermore, it would be foolish to presume that a financial entity deliberately sells a product knowing that, in future, the process of sale or even the product itself, will eventually lead to a complaint.

On the other hand, one cannot deny the fact that many consumers may be disgruntled by the performance of a financial product or delivery of service of a financial entity and that is why all licensed entities are required to have in place easily accessible complaint handling procedures available to consumers.

This is not a formality created to dissuade consumers from making a complaint, rather, it is a necessary requisite of proper consumer-entity relationship, especially when things may unexpectedly go wrong..

It is expected that many consumers are sometimes reluctant to send a formal complaint in writing to their licence holders.

The Office of the Consumer Complaints Manager meets consumers from all walks of life, including those who believe that formalities should be done away with.

In reality, some complaints expose the true reason why some consumers may be dissuaded from complaining. Very often consumers are not comfortable with filling forms or writing a letter, even if such a situation may be resolved by having the form compiled by a trusted person of the complainant.

It is also never simple to understand how many consumers ended up being sold financial products which should have never been offered to them in the first place.

Regrettably, such consumers blindly entrust their hard-earned savings to mere sales staff, only to face a bitter situation some months or years later when it is too late to remedy the situation.

Although a prospective investor should be aware of his/her responsibilities prior to committing his/her savings into any financial product, undeniably some documentation is difficult to understand due to the language jargon, description of the product or both and many investors simply rely on the explanation which is relayed to them.

Many consumers are aware of the  the Union Banking Mediators  existence and there have been several occasions where consumers came to the Authority’s offices to lodge a complaint without first complaining to their financial entity.

The Union Banking Mediators  is taking a very firm stand on this and no complaint is registered with the  the Union Banking Mediators  if the financial entity is not given the opportunity to state its case (which a complainant then has every right to refuse).

There are some cases however, especially for insurance complaints, where complainants (including third party claimants) are left in limbo by some companies as to the progress of their claim. In these particular instances, the Union Banking Mediators  will accept to register a complaint from a third party claimant, if it perceives that there are unreasonable delays or that the insurer had not been in touch with the claimant for an abnormally long time.

Normally, a licence holder would include a reference in the final letter to the complainant stating that, should the latter refuse the conclusions of the complaint, the matter could be referred to the  Consumer Complaints Unit.

There is a trend – which manifested itself more during the year under review when compared to previous years – where licensed entities actually made us aware that a client of theirs would be calling or filing a complaint with the Unit against them.

Unusually, this occurs in the event of an impasse between the entity and the complainant despite several attempts by the former to explain a situation or a circumstance over which the former might not have had control.

The Consumer Complaints Unit is noticing this trend in the case of some complaints which for example relate to the performance of investment portfolios or valuations relating to cash surrender values of life insurance products.

The Consumer Complaints Act specifies that the Office of the Consumer Complaints Manager may only handle complaints from private consumers.

However, there are occasions where small companies too may have complaints against financial providers which do not necessarily require all the formalities of the Courts to be resolved but rather a low-key out-of-court system, such as the  complaints handling mechanism.

Technically, the Unit would not be acting wrongly if it outrightly refuses to handle complaints from directors of small companies.

Thus for the sake of practicality, in the case where the matter appears prima facie to be straightforward to conclude, the Unit may initially accept to carry out preliminary reviews of complaints from such entities (for example, if the Unit had similar complaints from private.


There are cases which may not require a lot of time to be reviewed.

This may happen if, for example, the complaint might have been reviewed previously and therefore it is likely that the outcome of the new case would be similar.

Some examples of these cases relate to complaints on charges (banking and investment services related complaints) and motor claims (such as delay in filing a claim or the right of a consumer to avail himself/herself of a courtesy car).

However, many cases have become fairly complicated to resolve within a very short time. In the year under review, several cases remained pending from 2010.

These cases were all relating to investments or investment portfolios which have failed following the collapse of financial markets during the second half of 2008.

The data of outstanding complaints as at end 2010 only gives a partial picture of the quantitative amount of complaints remaining outstanding.

The data does not however indicate the qualitative value of the underlying reason behind the complaints and the continuing process to investigate them.

In addition, many complaints straddle regulatory concerns which may take longer to resolve and this may not be easily understood by complainants.

Moreover, for the first time, the Unit had been faced with a mass complaint relating to specific investment products, which exposed features of the way such products might have been sold. The review process of these complaints will continue in earnest in 2011.

In handling a complaint, the  the Union of Banking Mediators considers all legislative aspects, industry practice and other cases previously reviewed. In this respect, the  the Union of Banking Mediators  issues its recommendations on the basis of what it believes to be fair and reasonable. In doing so, the Union of Banking Mediators takes into account the law, rules and good practice in the industry.

In fact, in the majority of cases, the  the Union of Banking Mediators  approach is largely based on what a formal judicial setup is likely to do in similar circumstances. In some other cases, the complainant may not have legal grounds to have his/her case upheld.

However, the Union of Banking Mediators  may put forward arguments for the financial entity to compensate a complainant purely on moral or compassionate grounds.

Depending on the circumstances of the case and the disposition of the financial entity, such recommendations may be accepted and compensation awarded (purely on an ex-gratia basis). In some areas, good industry practice has developed separately from the law.

Tatu  Tudor