Government’s new laws for dispute resolution will identify individual firms which fail to resolve disputes internally
.jpg)
Government’s new laws for dispute resolution will identify individual firms which fail to resolve disputes internally
ASIC will be able to identify individual firms whose internal resolution schemes consistently fail to deliver for customers.
Minister for Revenue and Financial Services Kelly O’Dwyer announced the measure would be added to the Bill setting up the Australian Financial Complaints Authority (AFCA), the combined industry ombudsman which will replace existing external dispute resolution schemes.
Before AFCA will consider a dispute, firms – including brokerages and lenders - will be given the option to settle disputes internally. However, ASIC will be allowed to publish data on how well firms resolve these disputes, including identifying individual firms.
AFCA will commence operations on the 1 July 2018 but brokerages will be required to maintain their existing external dispute resolution scheme membership for a further 12 months.
A single dispute resolution scheme
AFCA has been under discussion for over a year and has divided opinion within the industry.
All brokers are currently members of the Credit and Investments Ombudsman (CIO) or Financial Ombudsman Service (FOS), both of which will be replaced by AFCA.
Raj Venga, chief executive of the CIO, has attacked AFCA as ‘not fit for purpose’: “It will neither provide better consumer outcomes nor be able to address past, or prevent future, financial scandals. AFCA is not equipped to weed out poor entrenched corporate culture or address the string of financial scandals that regularly grace the pages of our newspapers.”
The MFAA has claimed AFCA’s one-stop-shop approach would benefit large firms such as the banks over brokerages, noting that “adverse findings from a monopoly scheme focused on the big end of town could end a broker’s business, and we don’t believe such a scheme would have the expertise to deal with disputes appropriately.”
However, the Australian Bankers Association says AFCA will make it easier for consumers to resolve complaints.
Is this industry going far enough to remove problem brokers?
ASIC’s Review of Mortgage Broker Remuneration called for improved governance and oversight of the industry, renewing calls for the removal of problem brokers.
The MFAA said that “consideration to be given to developing a mechanism that can remove brokers from the industry for significant poor conduct”.
At MPA’s recent Aggregators Roundtable, a viewer asked aggregators whether they were going to take peer reporting of poor behaviour more seriously. PLAN CEO Anja Pannek replied that “I think there needs to be a fair degree of rigour with whatever process we take forward. These are people’s careers and livelihoods and they’re often very complex matters with certain circumstances, from a number that I’ve seen.”
ASIC can currently remove brokers from the industry but the process can take several years.
Are you a top broker? Prove it!
ASIC will be able to identify individual firms whose internal resolution schemes consistently fail to deliver for customers.
Minister for Revenue and Financial Services Kelly O’Dwyer announced the measure would be added to the Bill setting up the Australian Financial Complaints Authority (AFCA), the combined industry ombudsman which will replace existing external dispute resolution schemes.
Before AFCA will consider a dispute, firms – including brokerages and lenders - will be given the option to settle disputes internally. However, ASIC will be allowed to publish data on how well firms resolve these disputes, including identifying individual firms.
AFCA will commence operations on the 1 July 2018 but brokerages will be required to maintain their existing external dispute resolution scheme membership for a further 12 months.
A single dispute resolution scheme
AFCA has been under discussion for over a year and has divided opinion within the industry.
All brokers are currently members of the Credit and Investments Ombudsman (CIO) or Financial Ombudsman Service (FOS), both of which will be replaced by AFCA.
Raj Venga, chief executive of the CIO, has attacked AFCA as ‘not fit for purpose’: “It will neither provide better consumer outcomes nor be able to address past, or prevent future, financial scandals. AFCA is not equipped to weed out poor entrenched corporate culture or address the string of financial scandals that regularly grace the pages of our newspapers.”
The MFAA has claimed AFCA’s one-stop-shop approach would benefit large firms such as the banks over brokerages, noting that “adverse findings from a monopoly scheme focused on the big end of town could end a broker’s business, and we don’t believe such a scheme would have the expertise to deal with disputes appropriately.”
However, the Australian Bankers Association says AFCA will make it easier for consumers to resolve complaints.
Is this industry going far enough to remove problem brokers?
ASIC’s Review of Mortgage Broker Remuneration called for improved governance and oversight of the industry, renewing calls for the removal of problem brokers.
The MFAA said that “consideration to be given to developing a mechanism that can remove brokers from the industry for significant poor conduct”.
At MPA’s recent Aggregators Roundtable, a viewer asked aggregators whether they were going to take peer reporting of poor behaviour more seriously. PLAN CEO Anja Pannek replied that “I think there needs to be a fair degree of rigour with whatever process we take forward. These are people’s careers and livelihoods and they’re often very complex matters with certain circumstances, from a number that I’ve seen.”
ASIC can currently remove brokers from the industry but the process can take several years.
Are you a top broker? Prove it!
MPA's Top 100 Brokers Report is currently open for applications and it takes just two minutes to apply. Winners will be featured in the magazine and online.
http://survey.keymedia.com/au/mpa/2017/top100/
