With the forthcoming release of the draft Compensation Scheme of Last Resort (CSLR) legislation and in our regular discussions with the advice sector, AFCA has noted the currently proposed scope of the CSLR treats complaints about losses arising from the sale, distribution and operation of managed investment schemes and financial products and the provision of financial advice differently.
AFCA intends to provide additional clarity to the sector and consumers on how it currently deals with and categorises these complaints. AFCA already ensures that complaints brought against financial firms are categorised appropriately and where our Rules permit, brought against the correct party. Similarly, AFCA must make a fair apportionment of liability where compensation is awarded in claims against more than one financial firm. We are committed however to ensuring all parties are clear about which financial firm is responsible for responding to a particular type of complaint and where the responsibility may lie for specific conduct.
To update our guidance, AFCA will be issuing an interim fact sheet and consulting with relevant stakeholders, including the financial advice industry, about a more formal approach document. We are doing this because it is important with the release of the CSLR legislation that everyone understands and has confidence in our current approach.
AFCA will consult to make sure our existing approach to these issues is well-documented and transparent. More information will be made available about this process shortly.
Published: 21 October 2021
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The Australian Financial Complaints Authority (AFCA) is a non-government ombudsman service providing free, fair and independent help with financial disputes. It is a one-stop-shop for consumers and small businesses who have a dispute with their financial firm, over things such as banking, credit, insurance, advice, investments or superannuation. Where an agreement cannot be reached between parties, AFCA can issue decisions that are binding on financial firms.