Former “Ombudsman” loses the right to use respected title
Reblogged from http://ceoemail.blogspot.com
The Retail Ombudsman loses title
The Retail Ombudsman (TRO) is no more. The private company, set up in 2015 to provide dispute resolution for consumers, has lost the right to use the respected title of “Ombudsman”.
The Retail Ombudsman resigns from the Ombudsman Association
TRO has resigned from the Ombudsman Association (OA), its trade body, for reasons that remain unclear. The resignation means that it is no longer allowed to use the “Ombudsman” title. The company is in the process of dropping the title during the course of this week. It will now operate as a provider of alternative dispute resolution (ADR) services, outside of the ombudsman system.
Companies House rules on using the “Ombudsman” title
Companies House rules stipulate that companies using the “Ombudsman” title must be members of the OA. The OA seeks to ensure the quality of its members through a periodic revalidation process. However, rather than complete the recent revalidation process, TRO resigned just as that process was concluding. Neither the OA nor TRO would comment on the circumstances which have caused the resignation.
The ADR/Ombudsman landscape
Privately-run ombudsman services have been a feature of the consumer landscape in the UK for several years. However, the system has been heavily criticised by consumer groups. It is described as being difficult to use, lacking transparency and not having a single point of contact for consumers.
Many of the largest high-street retailers, including ASDA, Tesco and Morrisons, had refused to co-operate with TRO. They preferred to use their own internal complaints process, another ombudsman or ADR scheme.
Who oversees ADR schemes
The appointment, regulation and management of private-sector ombudsmen is fragmented. It is dealt with through a complicated combination of the Department for Business, Energy & Industrial Strategy (BEIS), the Chartered Trading Standards Institute (CTSI), the Ombudsman Association (OA) and Companies House. BEIS would not comment on TRO’s loss of ombudsman status, instead deferring to the Companies House press office, who in turn have not provided any substantive comment.
Comment on the ADR situation
Marcus Williamson, the editor of consumer information website CEOemail.com, who has been monitoring private ADR since 2014, said: “The behaviour of TRO – in resigning during the OA revalidation process – demonstrates once again that a retail ombudsman role is too sensitive to be handled by the private sector. It is time that retail was given a government-run ombudsman system, in a similar way to the financial sector.”
Williamson – who co-authored the June 2016 report Ombudsman Omnishambles with Helen Dewdney – suggested that TRO’s management had made a number of fundamental errors of judgement in its 2 1/2 years of operation. This included, he noted, employing both a convicted criminal as its communications director and having an ombudsman individual who had breached the Companies Act on multiple occasions. Williamson believes that OA and CTSI should insist on a “fit and proper person” test prior to allowing any individual to take on an ombudsman role.
About Dean Dunham
The Retail Ombudman had been run by Dean Dunham, a solicitor, former restauranteur and former celebrity lawyer, who established TRO in early 2015. He claimed to have 15,000 retail companies as members of TRO and 100 staff, although the company’s accounts filed at Companies House do not support these figures. He also had a regular slot on the London-based LBC talk radio channel, offering consumer advice, and has a Sunday Mirror column.
Westminster Business Forum seminar Next steps for consumer protection in the UK – dispute processes, enforcement and the consumer markets green paper. 15/11/18
Presentation. Alternative Dispute Resolution – approval and oversight in the loosest possible sense of the words…
Update 21st July 2017
Statement on The Retail Ombudsman by the Ombudsman Association
Update February 2018
The section from the OA’s minutes below is taken from the More Ombudsman Omnishambles report:
“10.The Retail Ombudsman – loss of ombudsman title
At the 102nd meeting of the Ombudsman Association Executive Committee, on 5 May 2017,the committee decided not to revalidate TRO for the reasons shown below. These minutes were online and publicly available until January 2018. They are now in a “members’ only” section of the OA website. In summary:
1) “The ‘pay as you go’ model operated in relation to their ‘Independent members’ resulted in a relationship that did not meet theOA’s membership criteria.”
2) “TRO did not have significant coverage / market share of the retail sector,”
3) “Concerns about the misleading information that had been provided on the Retail Ombudsman’s website”
4) “Concerns in the information provided regarding their list of members.”
5) “Presentation of non-member logos in their annual report could be misleading”
6) “Been alerted that 33 of the Furniture Ombudsman’s corporate members were at that time incorrectly listed on the Retail Ombudsman website as being Independent Members of their scheme. The Validation Committee had subsequently received correspondence from some of those organisations confirming they had no relationship
with the Retail Ombudsman.”
7) “Awareness of the proliferation activity of the Retail Ombudsman in setting up online and social media presences for other sectors: FinanceADR, UtilitiesADR and CommsADR. The FinanceADR website advertised that they could deal with some complaints that in fact fell within the regulated jurisdiction of the Financial Ombudsman Service.”
8) “Concerns about levels of governance and accountability within the organisation.”
9) “The Executive unanimously agreed that the accumulation of examples of inaccurate and potentially misleading information to the public in relation to their membership and jurisdiction demonstrated that the Retail Ombudsman did not meet the OA’s overall membership criteria of Openness & Transparency, and risked substantial reputational damage to the OA.”
“The Executive did not have the trust or confidence that these issues could be resolved satisfactorily and voted unanimously to propose the expulsion of the Retail Ombudsman
under section 6 of the Association’s Rules.”(Please see Appendix J for full details).
A statement placed on The Retail Ombudsman website in July 2017 claims that the decision to transition from ombudsman to non-ombudsman had been taken entirely by Consumer Dispute Resolution Limited:
“CDRL had aspirations to expand its ADR offering, under The Retail Ombudsman brand into sectors beyond high street and online retail. However, last year Ombudsman Association introduced a rule that it would only allow one ‘ombudsman’ scheme per sector which meant that CDRL would not be able to continue its expansion plans as an ombudsman. Naturally, CDRL had to respect this decision.”
However, the OA had written to TRO to outline its position before it resigned.
Ombudsman Association’s position on The Retail Ombudsman
In response to TRO’s statement, the OA responded:
“The OA’s Validation Committee reviewed The Retail Ombudsman’s (TRO) submission for re-validation on 25 January 2017 and on 19 April 2017.
TRO was originally admitted to ‘Ombudsman membership’ of the OA as it appeared on paper that our membership criteria was met, but it was subject to re-validation so that practical evidence of compliance could be demonstrated.
The Validation Committee reviewed the application and the further papers submitted. Following careful consideration the Validation Committee unanimously agreed that TRO did not meet the OA’s membership criteria.
The Validation Committee’s recommendation was considered by the OA Executive Committee on 5 May 2017, and was carried unanimously. TRO was invited to address the next meeting of the OA Executive Committee before a final vote be taken to withdraw TRO’s membership. However, TRO resigned its membership before the final stage of the revalidation process was completed.”
It would appear therefore that TRO resigned, rather than be expelled, as it would have been if it had fully completed the OA’s revalidation process.”
Update 23 August 2018
Landing in court with Ryanair the latest including failures in AviationADR, Which? and The Independent reports on CDRL which runs these schemes.
June 2016 Ombudsman Omnishambles Serious unresolved issues affecting the operation of the ombudsman ADR system in the UK
Companies House rules on use of Ombudsman title https://www.gov.uk/government/publications/incorporation-and-names/annex-a-sensitive-words-and-expressions-or-words-that-could-imply-a-connection-with-government
(see paragraph 1.86)
TRO members list
TRO staff numbers and retail members
Companies formerly run by Dean Dunham
Accounts for Consumer Dispute Resolution Limited, trading as The Retail Ombudsman