Policy overview
A lot of the customer legislation is underpinned by the notion of a typical customer and what the typical customer may expect, understand or how they might behave. Customers in vulnerable circumstances may be significantly less able to represent their own interests, and more likely to suffer harm than the average customer.
FCA Definition: A vulnerable consumer(customer) is someone who, due to their personal circumstances, is especially susceptible to detriment, particularly when a firm is not acting with appropriate levels of care.
Examples of a detriment:
- Emotional stress or embarrassment
- Financial
- Loss of trust in firms.
- Reduced ability to obtain redress .
- Wasted time resolving issues.
Vulnerable customers can be identified in many ways.
It may be a sudden change in circumstances, loss of job, bereavement, or it could be a long-standing vulnerability such as an illness.
Often it is a combination of factors that will particularly affect a vulnerable customer. It must be remembered that the customer may not identify themselves as vulnerable.
An example of some types of vulnerable customer are:
- Low literacy, numeracy and financial capability skill
- Physical disability
- Severe or long-term illness
- Mental health problems
- Low income and debt
- Caring responsibilities
- Elderly
- Inexperienced – young customers.
- Change in circumstances – job loss, bereavement, divorce. . Lack of English skills.
- Non-standard requirements – e.g. Armed forces returning home, ex-offenders, recent immigrants.
Staff at Gotham Bespoke Ltd are aware that customers may not be able to deal with their financial affairs alone, and therefore may opt to have a third party manage their affairs. This may be in the form of an authorisation or an arrangement such as Power of Attorney/lasting Power of Attorney. There should not be any unnecessary barriers for the customer if this is the case.
Process
If a member of staff identifies a vulnerable customer, they should obtain management approval to continue the sale. It would be at this stage that the firm takes the appropriate steps to ensure the customers’ needs are addressed.
Below are some guidelines on how we deal with vulnerable customers.
What we do:
- Provide the customer with a clear and simple product presentation.
- Look out for signs that the customer does not understand our explanation.
- Suggest the customer brings a relative, friend or other reliable source of support if they are finding it hard to understand.
What we don’t do:
- Rush explanation or pressure customers.
- ignore or sidestep customers questions.
- Make up an explanation if we do not understand it ourselves.
Monitoring and reporting.
Monitoring is undertaken as per Gotham Bespoke Ltd internal monitoring procedures.
