Crucially, unlike the court system, which primarily focuses on whether a company has breached any laws, the ombudsman operates under the regulator’s ‘treating customers fairly’ principles.

Their remit extends beyond regulated financial activities to encompass overall company conduct, ensuring fair treatment in various aspects.

In making decisions on individual complaints, the law[8][9] requires the ombudsman to take into account: relevant law and regulations; regulator's rules, guidance and standards; codes of practice; and (where appropriate) what he/she considers to have been good industry practice at the relevant time.

The payment of these statutory levies and fees is not optional and they are payable whether or not a complaint is upheld by the Financial Ombudsman Service.

[13] The ombudsman was set up by parliament to be an impartial and independent body, though its decisions can be criticised by the side that loses.

[23][24] Since September 2009 the Financial Ombudsman Service has been publishing complaints data on its website every six months about named individual businesses.

The BBC reported in September 2007 that the ombudsman planned to reduce staff numbers to 600, reflecting the decline in mortgage endowment complaints.

Currently there are 4,500 people working at the ombudsman – reflecting a substantially increased workload of over half a million cases last year (2014/2015).

Staffing levels at the Financial Ombudsman Service fluctuate – as does the budget year-on-year – to match the volume of disputes it is dealing with.

The number of staff required – and forecasts for complaints volumes and workload – are consulted on publicly each year in the ombudsman's corporate plan and budget.

For example, in January 2011 the British Bankers Association – on behalf of a number of high-street banks – brought a judicial review against the ombudsman and the FSA on the approach to PPI complaints handling.

This is referred to as the Wednesbury unreasonableness principle which applies to any application for judicial review under made due to the irrationality of the decision.

The board's role includes guarding the independence of the ombudsman – from undue influence by the financial services industry and trade bodies, regulators, consumer groups and government.

The current holder of the post is Gillian Guy, previously Chief Executive of Citizens Advice for England and Wales, whose appointment was announced by the Financial Ombudsman Service on 26 August 2020 to take effect from October 2020.