Financial services firms can now submit responses to the government’s new external dispute resolution (EDR) framework, which will grant further powers to ASIC and instate a new complaints authority.
Yesterday, the government released its consultation papers for industry feedback on the new EDR scheme for financial services, which was announced in the 2017 federal budget recently.
As part of the new EDR scheme, a dispute resolution body will be formed called the Australian Financial Complaints Authority (AFCA), which will replace FOS, the CIO and the Superannuation Complaints Tribunal (SCT). The AFCA will be operational from 1 July 2018 and all financial firms must be members of the new body.
ASIC powers will also be strengthened for “enhanced oversight and monitoring” of the scheme while financial services firms will adhere to “enhanced transparency and accountability of internal dispute resolution activities”, the EDR consultation paper states.
According to the scheme’s explanatory memorandum, additional powers will also be granted to superannuation complaints.
The new EDR scheme introduces two new bills into Parliament - the Treasury Laws Amendment (External Dispute Resolution) Bill 2017 and Treasury Laws Amendment (External Dispute Resolution) Regulations 2017.
The CIO has recently responded to the new EDR scheme claiming it is a “complete waste of money”, while the FPA has cautioned against the cost of establishing the AFCA, which will be funded by the industry via a new levy, adding additional cost pressures on consumers.
The closing date for submissions on the new EDR scheme is 14 June 2017, the government said.
SUBSCRIBE TO THE IFA DAILY BULLETIN
09:10Global managers added to OneVue platformBy Staff Reporter
07:42Fintech a risk to specialist advisersBy Killian Plastow
09:04No 10-year rule, FASEA confirms to FPABy Aleks Vickovich
22 Feb 2018Registered tax adviser numbers return to 19,000By Staff Reporter
22 Feb 2018AMP adviser banned for charging dishonest feesBy Staff Reporter
22 Feb 2018Rod Bristow named Macrovue CEOBy Aleks Vickovich
- view all