Consumer safeguards

What they are

If you want to report irregular or improper conduct on the part of a bank or other financial intermediary relating to banking products or services, there are several things you can do.

  • You can make a complaint directly to the intermediary;
  • You can use an alternative dispute resolution system;
  • You can file a lawsuit.

All financial intermediaries must have a Complaints Office, which has to respond to customers within 30 days of receiving complaints about banking products and within 15 days for complaints about payment services. There are different timeframes for complaints about insurance products (45 days) and investment products (60 days). Information on contact details and how to submit a complaint is usually available on the intermediary's website.

If you don't receive an answer within the stipulated deadline, you can contact:

  • one of the alternative dispute settlement systems provided for by law;
  • the judicial authorities.

The Banking and Financial Ombudsman (Arbitro Bancario Finanziario - ABF) is an alternative system for settling disputes between intermediaries and customers. It has been operative since 2009 for disputes involving banking products and services (for example, current accounts, mortgages and personal loans). If the appeal falls within the jurisdiction of the ABF, it can be dealt with quickly and at a low cost (€20).

If you want to report irregular or improper conduct on the part of a bank or other financial intermediary, you can also involve the Bank of Italy by making a complaint. The complaints, which must state who the customer is, indicate the bank or banks involved and describe what happened clearly, are sent to the Bank of Italy, which does not intervene directly with a decision. Instead, it examines the complaints received and usually sends a copy to the intermediary concerned. It also invites the intermediary to send a prompt and thorough response to the customer. If the Bank of Italy has no competence to deal with a complaint received, it forwards the complaint to the competent authority, and informs the customer that it has done so. The complaints sent to the Bank are a source of information for its supervisory work.

Interested parties

Any customers who are not satisfied with their bank or who want to report irregular or improper conduct on the part of a bank or other financial intermediary.

Strengths and drawbacks

There is a proper system of safeguards for banks' customers to use, which consists of four connected parts. 

First of all, there are the rules that require banks on the one hand to provide customers with useful information that is as clear as possible and on the other to behave correctly towards customers. For example, banks are required to assist their customers, and must have a Complaints Office to help customers efficiently.

Of course, if there are rules then there also needs to be some kind of 'police force' to make sure they are respected, and this is the Bank of Italy's task through its supervisory work. If the Bank of Italy detects a small mistake in a bank's conduct that did not cause significant damage to the client, it asks the intermediary itself to take effective action to resolve the problem. If a mistake has caused damage to the customer, the Bank of Italy asks the intermediary to refund the customer directly. Finally, if the problem is even more serious, pervasive and deliberate, the Bank of Italy may impose a range of sanctions on the intermediary.

However, individual customers also need to be able to activate some defence mechanisms by themselves that can help them find a solution to their problems and this is where the possibility of contacting the ABF comes in.

In conclusion, it is important that customers have a better understanding of how markets and banking and financial products work. This is where financial education is useful and the Bank of Italy is not the only authority involved here. There are also other authorities in the Italian system: CONSOB, IVASS, COVIP and the AGCM, each one with its own field of competence.

Expenses

You can submit complaints free of charge and you don't need a lawyer to help you.

Filing an appeal with the ABF only costs €20, which covers the procedural costs.  If your appeal is upheld, even only partially, the intermediary will have to refund the €20.

Underlying rules

Sending a written complaint to the intermediary is important, because if you're not satisfied with the response or you don't receive one, you can then appeal to the ABF. Don't forget that an appeal can only include issues that were already set out in the previous complaint.

You can appeal to the ABF no later than 12 months after submitting your complaint to the intermediary. If 12 months have already elapsed you'll have to file a new complaint.

The ABF carries out its tasks and decides disputes as an independent and impartial body, assisted in its work by the Bank of Italy. The appeal is decided based exclusively on the documentation filed by the parties (claimant and intermediary); no legal assistance is required. For information on how the ABF system works and how to lodge an appeal, see the ABF's website.

The ABF's decisions are not legally binding, but if the intermediary does not comply with them, its non-compliance is made public.

Pitfalls

It may happen that a bank's customer asks the Bank of Italy to resolve their problem directly with the bank by deciding who is right and who is wrong. It is important to make it clear that when the Bank of Italy receives a complaint:

  • it does not make any decision concerning the contractual relations between the intermediary and the customer (unlike the judicial authorities or the alternative dispute settlement systems like the ABF), or concerning the independent evaluations made by individual intermediaries, for example for granting a mortgage;
  • it does not usually respond to complaints on issues already submitted to the judicial authorities or to the ABF;
  • it does not disclose the results of any investigations carried out on intermediaries.

Keywords

SERVICES FOR THE PUBLIC

The Bank of Italy directly provides a number of services for the public.

Among other things, it deals with complaints filed by the public, it manages the Banking and Financial Ombudsman’s technical secretariats, it works on? and promotes financial education, and it publishes information on unauthorized banking and financial intermediators in Italy and other news in the public interest. The Supervision Department also carries out analyses of the banking and financial system.

The Bank of Italy also manages the Central Credit Register and the Interbank Register of Bad Cheques and Payment Cards. You can make requests or reports relating to the Central Credit Register, the Interbank Register of Bad Cheques and Payment Cards, complaints, whistleblowing, and how banking and financial services work, by accessing the Bank of Italy's 'Online Services for the Public' platform.

CONSUMER SAFEGUARDS

Consumer safeguards may be used by those who have had a problem with a bank or financial intermediary. Specifically, a consumer may:

  • submit a complaint directly to the intermediary;
  • seek redress from a system for alternative dispute resolution;
  • submit the dispute to the civil courts.

All intermediaries are required to establish a complaint office which must respond to consumer complaints within 30 days from the date in which the complaint is received. Usually, the information on the complaint office and on how to submit a complaint are available on the intermediary's website.

If the intermediary does not respond to the customer within 30 days, or if the customer is not happy with the reply, he or she can appeal to:

  • one of the systems for alternative dispute resolution;
  • the civil courts.

The Banking and Financial Ombudsman (Arbitro Bancario Finanziario - ABF) was created in 2009 as a system for alternative dispute resolution between customers and intermediaries. If the complaint falls within the jurisdiction of the ABF, it can be dealt with in a short time and at a low cost (€20). The information concerning the functioning of the ABF and how to file a complaint can be The customer can also submit a complaint to the Bank of Italy. Upon receipt of a complaint, the Bank of Italy usually sends a copy to the intermediary requesting the intermediary to timely and thoroughly respond to the customer; it investigates the issues reported and checks that the relations between customers and intermediaries are sound; and it may collect further information to carry out its supervisory function. In case the Bank of Italy is not competent to deal with a complaint, it forwards it to the competent authority, if not already engaged, and advises the customer accordingly. For more details, see the Bank of Italy’s website.