Consumers are left out in the cold at Gifit’s ‘low-threshold’ complaints desk

Nynke Andringa still feels cheated. She trusted her financial advisor and arranged for her to become a co-owner of her boyfriend’s home. The counselor made sure she was credited on the mortgage and had a signature on it. After the relationship ended, Andringa did not become the owner of the house, but became jointly and severally liable for the mortgage debt. Andringa complained to her financial advisor. She wanted him to admit his mistake.

Andringa went to the gift counter, where customers can go for help with complaints about their bank, insurer or financial service provider. GIFIT was established in 2007 by trade associations of banks, insurers and financial service providers and a consumer association as an alternative to the courts. Gifit is designed to be an accessible counter where consumers can file complaints for free if going to court is too expensive.

Andringa had to wait almost a year before his case was heard by the Disputes Committee. When he sat down at a long conference table in the complaints body’s office in The Hague in January 2019, he discovered that his financial adviser had brought his lawyer with him. Opposite them sat the chairman and secretary of the dispute committee.

Andringa had come alone. A lawyer is very valuable. Also, she counted on the Disputes Committee to help her through the process of framing her complaint. So she was surprised when the chairman immediately asked her to make a last-ditch effort to work it out with the financial advisor. Andringa didn’t like it because the previous attempt had already failed. But the leader stood his ground: otherwise the verdict might turn out to be negative for him.

“Then I suddenly felt very small,” says Andringa. Not long after, she was stunned to leave with a handwritten note in which the financial adviser said she would no longer inform her clients of the risks of mortgages. “Written Confirmation [van de uitkomst van de bemiddeling] I never got what Gifit promised,” says Andringa. Complaint registered on Remedy Gifid.

Get well soon

Andringa’s experience at Gifid was not an isolated one. Since its launch in 2007, Gifit has come under constant criticism. Criticisms were that the panel’s dispute panel did not listen carefully, paid too little attention to the difference in knowledge between consumers and financial service providers, and adopted a more formal and legalistic stance. Kifid promised progress in 2016 and offered ‘a fresh perspective on complaint handling’. Kifid will listen carefully, help the consumer to formulate the complaint and provide interim explanations while handling the complaint. According to research by the Investigative Journalism site, that still doesn’t solve all the problems Inquiry Desk.

Gifit Disputes Committee should not deal with such serious matters

Ellen Timmer Lawyer

Gifit receives an average of five thousand complaints every year, for example, on mortgages, bonds, loans and investment, life and non-life insurance. Of the complaints handled in the last five years, 32 percent were decided in favor of the service provider and only 7 percent in favor of the consumer. An appeal to Kifid can only be made in the case of disputes over a minimum of 25,000 euros. More than 90 percent of complainants choose a binding decision because it is enforceable in court if the service provider does not comply. But there is also a downside: if the consumer is proven wrong before Kifid, the court can cancel the binding decision only if the complaint desk has made major mistakes.

But Gifit mainly tries to focus on mediation between the parties, as happened with Andringa. First, the secretary tries to mediate. If that is not possible, a complaint will be made to the Disputes Committee. He often tries to mediate again and makes a different decision. According to the 2020 annual report, mediation “results in less administration and you can expect both parties to go home satisfied”.

This is also reflected in the number of settlements. The number of cases settled by the complainant and the service provider increased from 21 percent in 2013 to 43 percent last year. “We now reach a mediated decision in almost half of the complaints,” says Eveline Ruinaard, Director and Head of Kifid’s Disputes Committee, in the 2020 Annual Report. “This is Kifid’s strength as an anti-judicial complaints agency. We differentiate ourselves from the courts.

However, it cannot be ascertained whether the settlements will have a positive effect on consumers. Contrary to reports, Gifit does not publish settlements, not even anonymously. As a result, almost half of the complaints handled are now impossible to verify whether consumers have rights.

According to Ruinaard, Gifit became accessible to consumers after 2016. “We’re not a court,” Ruinard says from Gifit’s large meeting room above the central station in The Hague. “We don’t even show up in gowns.” He emphasizes: “From the very beginning when people knock on our door, we are very service-oriented and we help them start a conversation with their service provider again. We have been very successful in that,” he said.

Complainants and professional representatives of complainants who spoke to the Inquiry Desk think otherwise. They believe that consumers cannot manage Gifide without the help of someone who understands the rules and laws. However, financial service providers complained about may seek expensive specialist legal aid or hire their own lawyers. Consumers who bring a professional representative to Kifid often have to pay for this. The compensation offered by Gift is a few hundred euros at most.

Increases complexity

Gifit also deals with increasingly complex cases. According to director Ruinaard, this is “because financial services and products are more complex”. But according to attorney Ellen Timmer, there are risks to closely following Giffidt’s statements. “It doesn’t hurt that Kifid deals with small consumer cases, but now there are also cases about the Bureau of Credit Records (BKR), which deals with what people borrow and whether they pay on time, with blacklisted fraudsters from a bank or insurer, or with people who no longer have access to their money. It’s a controversy like this. A settlement system should not handle such serious matters.

Timmer, among others, helped Ronald Aries, who threatened to lose his Dutch bank account after a conflict with his bank. Previously met Aries NRC Speaking about his case, he had informed his bank that he had no tax liability abroad as he had lived in the Netherlands all his life. But his bank thought he was a US taxpayer because he was born in the US. According to the bank, he is guilty of fraud. The Gifit Dispute Panel agreed with the bank. Since Aries chose non-binding judgment, he can still go to court. He established that the bank falsely charged Aris and was not allowed to close his accounts.

Complainants and professional representatives also criticize the lack of complaints during investigations. As statements are not made, the people at home cannot read what is said in silence. Ruinaard rejects the criticism. “That’s not necessary, the parties are on their own.”