A welcomed authorisation of AFCA!
3 May 2018
On 1 May 2018, the Minister for Revenue and Financial Services authorised the operation of the Australian Financial Complaints Authority (AFCA): a new single external dispute resolution (EDR) scheme for consumer and small business complaints. The Minister announced that:
- All financial firms required to have a dispute resolution system to deal with complaints from consumers and small businesses, including existing members of the Financial Ombudsman Service (FOS) & Credit and Investments Ombudsman (CIO) must become members of AFCA by 21 September 2018. They must also retain their existing membership of the FOS or CIO scheme until further notice
- AFCA will be governed by a board of 11 directors, consisting of a chair and an equal number of industry and consumer directors. On 4 May 2018, the Minister will be appointing a minority of the inaugural AFCA board including Ms Claire and Mr Andrew Fairley as industry directors, together with Ms Erin Turner and Mr Alan Wein as consumer directors.
Read previous article: AFCA to be receiving disputes by 1 November 2018.
The transitional arrangements are summarised below:
The next steps proposed for the transition process include that AFCA will shortly consult publicly on new AFCA Rules and an interim funding model (AFCA Rules will be subject to ASIC approval).
Lenders are likely to require guidance on the upcoming regulatory changes and transition period over to AFCA. Gadens can assist in providing legal advice on implementing and complying with the new EDR scheme.
For more information, contact:
T: +61 3 9252 2522
Associate & Pro Bono Coordinator
T: +61 3 9252 7735
Annette Gaber, Partner
Susan Sumars, Associate & Pro Bono Coordinator
This update does not constitute legal advice and should not be relied upon as such. It is intended only to provide a summary and general overview on matters of interest and it is not intended to be comprehensive. You should seek legal or other professional advice before acting or relying on any of the content.