The Australian Financial Complaints Authority (AFCA) has released its Systemic issues insights report for the 2021-2022 financial year.
AFCA identifies systemic issues that have been raised in a complaint or several complaints, which are likely to affect a class of persons in addition to any person who lodged a complaint or raised a concern.
It must report systemic issues to ASIC, APRA, the ATO, the OAIC or other appropriate body, in accordance with its Rules and its obligations under the Corporations Act 2001 and ASIC Regulatory Guide 267.
In 21-22 a total of 67 systemic issue reports were made across industry sectors: 41 in banking, 11 in general insurance, 4 in life insurance, 2 in investments and advice and 9 in superannuation.
AFCA identifies the following common risk areas:
- over-reliance on manual processes;
- breakdowns when a financial firm retires a legacy IT system and transitions to a new system;
- processes that run across multiple IT systems and software programs;
- complaints handling when financial firms have not adequately invested in or resourced their teams to effectively manage complaints at both internal dispute resolution (IDR) and external dispute resolution (EDR) stages.
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Author: David Jacobson
Principal, Bright Corporate Law
About David Jacobson
The information contained in this article is not legal advice. It is not to be relied upon as a full statement of the law. You should seek professional advice for your specific needs and circumstances before acting or relying on any of the content.