New dispute resolution body AFCA launches after Banking Royal Commission
In the wake of the Banking Royal Commission, Aussie shoppers and small businesses now have another avenue for resolving financial disputes, with the Australian Financial Complaints Authority (AFCA) open for business from today.
The AFCA is a new, independent dispute resolution scheme, which replaces the existing Financial Ombudsman Service (FOS), the Credit and Investments Ombudsman (CIO) and Superannuation Complaints Tribunal (SCT).
“AFCA will play an important role in restoring trust in Australia’s financial institutions in the wake of the Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry,” AFCA Chair Helen Coonan said, launching the service today.
Mozo Director Kirsty Lamont welcomed the steps that AFCA has taken towards helping Aussies resolve disputes about their finances.
“If the Banking Royal Commission has shown us one thing, it’s that Aussies are impatient for better transparency and accountability when it comes to dealing with financial companies. Hopefully, AFCA will provide that,” Lamont said.
Financial firms will be required to be a member of AFCA either by law, or as a condition of holding a financial services licence. AFCA itself will be governed by terms of reference known as The Rules which outline the types of disputes it will mediate, what solutions it can enforce and their limits, the dispute resolution process and its obligations for reporting disputes.
The Rules have been approved by ASIC, and AFCA has “an independent assessor to deal with complaints about its handling of disputes” in order to increase accountability.
Quick guide to AFCA Rules
AFCA Chief Executive and Chief Ombudsman, David Locke said that, “AFCA will provide Australians with services that are easy to use, free and efficient. We will use a range of skills including conciliation and negotiation to find fair solutions for all the parties.”
“Where matters cannot be settled then we will make timely and impartial determinations based upon the evidence. Any determinations of AFCA, if accepted by the consumer or small business, is binding on the financial services firm involved.”
How to lodge a complaint with AFCA
Both regular Aussies and small businesses can make a complaint to AFCA either online at afca.org.au, by calling 1800 931 678 or emailing firstname.lastname@example.org.
What about ongoing disputes?
For those Aussies with current disputes lodged with the Financial Ombudsman before today, your dispute will still be handled under the existing rules of the FOS.
If your dispute is lodged with the Superannuation Complaints Tribunal, get in contact with them to find out how it will be handled. Strict time limits apply to superannuation disputes, so it may be resolved differently.
All new disputes lodged after 1 November 2018 will be handled by AFCA, under its new rules.