Super funds slow to sign on to new complaints tribunal

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More than a third of superannuation funds have failed to sign on to the new government complaints body, the corporate watchdog said this week.

The Australian Securities and Investments Commission (ASIC) has approved rules and terms of reference for the Australian Financial Complaints Authority (AFCA).

The new body will merge the functions of the Superannuation Complaints Tribunal, the Financial Ombudsman Scheme (FOS) and the Credit and Investments Ombudsman (CIO).

Until 31 October 2018, super fund complaints will be heard by the SCT. Complaints already lodged with the SCT will not be transferred to AFCA. Similarly, any complaints withdrawn from the SCT will not be allowed to be relodged with the new authority.

Fund members’ complaints will only be heard by AFCA from 1 November 2018, however, just 64 per cent of funds have registered with the new tribunal.

Funds that are not compliant with AFCA have just one week to sign up. ASIC said it was a statutory requirement that financial firms which deal with retail clients must join the scheme by 21 September 2018.

“AFCA will be able to deal with complaints about financial firms including banks, credit providers, insurance companies and brokers, financial advisers, managed investment schemes and superannuation trustees,” ASIC said in a May statement.

The green light for the tribunal comes in the wake of the banking royal commission having heard evidence of bank-owned and retail funds illegally charging fees for no service.

Former Howard minister Helen Coonan, who chairs AFCA, said the new tribunal “will provide consumers and small business with access to fair, free and independent complaint resolution”.

“We look forward to working with ASIC, and consumer, small business and industry stakeholders in implementing this important reform, which will assist in restoring trust and confidence in the financial services industry,” she said.

Also this week, law firm Slater and Gordon announced it would launch a class action against some bank-owned super funds to recover around $1 billion in fees wrongly charged to members.

Estimates suggest there are millions of Australians who might be eligible to take part in the lawsuit.

ASIC said that almost all FOS members had transferred their membership to AFCA, as had 80 per cent of members of the CIO. But just 64 per cent of superannuation trustees and retirement savings accounts providers had, so far, joined up.

Would you be concerned if your superannuation fund had not signed up to the new complaints tribunal yet, in light of the banking royal commission evidence.

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Written by Olga Galacho


Total Comments: 8
  1. 0

    When I got to “Former Howard minister Helen Coonan…..” I realised that this is going to be yet another loaded regulator acting for the interests of business.
    Been there and done that. Most recently the Telecommunications Ombudsman which acts for the big telcos in all matters other than minor bill issues. Don’t think any regulator stacked with ex Liberal Party hacks will be any different. Helen Coonan…..yeah I remember her well.

    • 0

      My biggest concern is also about an ex-Howard Minister (rusted on Liberal) being appointed to this key role – it should have gone to an independent, professional and tough Judge type of person (maybe selected by the RC).
      Can’t except honesty, straight answers & effective actions from an ex-politician!

  2. 0

    Takes time to study the contracts but I’m sure all would sign off before the deadline .
    The members of new tribunal are all respected lawyers and pillars of society who will work in the best interest of super members and not industry or retail funds
    The RC has come up with some great recommendations to fix the issues identified at the hearings

  3. 0

    Mick, I agree with the first part of your comments. However, I have found the TIO to be one of the most efficient and Professional organisations I have dealt with. I have nothing but praise for the TIO.

    • 0

      Really? Wait until Optus disconnects you for 2 months, refuses to reconnect, leaves you in their India Call Centre for a full day of overseas calls and then refuses to pay the MANDATED compensation which the current government waves in the air but which only a lawyer can enforce.
      Been there. Done that. Good luck to you if you end up with a serious issue. The TIO will hang you out to dry. They even tried the “we are busy and cannot get to your complaint for a month” BS. As if disconnection is not top of the (priority) heap. Still give me the heevie geevies thinking about what Optus did to us, longstanding great customers, after 15+ years of putting up with their crappy substandard service.
      Do I sound like a disgruntled customer? You bet. Have good reason to be. And I have not even relayed some of what this behaviour did to our ability to get on with life. Like electricity we all take communications for granted. Once gone one realises the impact.

      As I said in my post above I hold no hope of “legislation” or a claimed Ombudsman if big business representatives have their grubby fingers in the pie.

    • 0

      Mick – what do you expect when you don’t pay your bills .
      A handout from the government ?
      Oh yes I forgot – that’s why you vote labor – steal from the hardworking taxpayer to give to the bludger

    • 0

      olbaid, you are in danger of upsetting the “cracked record”.

  4. 0

    Law firms do a lot of good for ordinary citizens. Such as Novadefenders, who are focused on criminal defense, reckless driving and dui representation, have helped many people



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