The external dispute resolution framework for the fin sector will begin in November
The Australian Financial Complaints Authority (AFCA) will begin accepting complaints from consumers and small businesses about products and services provided by financial firms, including brokers and lenders, beginning 1 November.
The new ‘one-stop shop’ external dispute resolution framework will replace the Credit and Investments Ombudsman (CIO), the Financial Ombudsman Service (FOS) and the Superannuation Complaints Tribunal.
The AFCA will be led by chief ombudsman and CEO David Locke, who is currently the assistant commissioner at the Australian Charities and Not-for-Profits Commission.
Financial service providers, including existing members of the CIO and FOS, must become AFCA members by 21 September, while also retaining their existing membership with the CIO or FOS until further notice.
Financial service providers should still promote their own internal dispute resolution (IDR) process to ensure consumers contact them on the first instance, rather than the AFCA, the CIO’s office said.
“You should set out your IDR process and contact details prominently in your written communications to clients,” the agency said.
In the CIO’s third quarter of 2017/18, it received an increase of 229 complaints for a total of 1,585. The office has 25,200 members.
The financial service providers who received the majority of complaints were: debt purchasers and collectors (35.6%) followed by motor vehicle providers (11.4%).
Residential lenders and mortgage managers received 10.6%, while finance brokers received 6.6%.
