The Interim Report of the Review of the financial system external dispute resolution and complaints framework has been published for consultation with the intention that the Final Report will be delivered to the Government by the end of March 2017.
The independent expert panel’s draft recommendations include:
- there should be a single industry ombudsman scheme for financial, credit and investment disputes (other than superannuation disputes) to replace FOS and CIO;
- that the monetary limits and compensation caps for the new scheme for financial, credit and investment disputes be increased (relative to the existing limits and caps imposed by FOS and CIO), including for small business disputes;
- the Superannuation Complaints Tribunal should transition into an industry ombudsman scheme for superannuation disputes;
- enhanced accountability and oversight over the two new schemes, including through strengthening the Australian Securities and Investments Commission’s powers.
- Once both of the new ombudsman schemes are fully operational and have garnered strong consumer and industry support, consideration should be given to further integrating the schemes to create a single scheme covering all disputes in the financial system.
Should there be a Tribunal?
The panel concluded that an additional statutory dispute resolution body is not required.
It consdered the recommendation for a Banking and Financial Sector Tribunal in the First Report on the Review of the Four Major Banks by the House of Representatives Standing Committee on Economics.
The Panel observed that many of the Committee’s recommended features for a Tribunal are consistent with the Panel’s draft findings and recommendations including:
- free access for consumers;
- decisions to be binding on members of the body;
- the body to be funded directly by the financial services industry; and
- the body to have a board that is comprised of equal numbers of consumer and industry representatives.