Speaking in an online members’ forum on Tuesday, AFCA chief operating officer Justin Understeiner said the ombudsman had received more than 3,180 complaints around COVID-19, including 1,430 banking and finance complaints and 610 superannuation complaints.
Around 680 complaints in the banking and finance category related to financial difficulty, Mr Understeiner said.
He added that a key category of complaint was around delays in early release of super, while other top categories included loan break costs, disputed transactions and requests to extend payment terms.
Mr Understeiner said a significant proportion of these complaints came down to poor communication from the financial services provider, as customer query numbers soared in the wake of the crisis and firms struggled to keep up.
“Many of these complaints result from poor communication, where a consumer has trouble contacting their firm, does not understand their policy, or is confused about the information they receive,” he said.
“To support consumers, we encourage financial firms to ensure their contact details and resources are visible and accessible and allow for genuine engagement with customers to resolve issues early on.
“We encourage financial firms to minimise COVID-19 related disputes by communicating with consumers early, speaking in plain English, proactively setting customer expectations around delays, reviewing internal dispute resolution processes and regularly engaging with AFCA.”
Mr Understeiner said the ombudsman expected to see a continuing increase in complaints in the following months, particularly until the end of the early release of super scheme in September.
AFCA puff their chest out and say, the long term average is ‘close’ to 50/50 decisions (45% in Adviser favour).
So advisers, you have a less than 50/50 chance of winning – however, you take out the amount of complaints that are considered frivolous or vexatious, you probably have about a 25% chance of winning, all things being equal. sounds fair to me. Just check out their new Fairness Project…all about being fair to the consumer,…
AFCA’s internal cultural flaw, is that they don’t understand, Advisers are small business owners, the lifeblood of all democratic economies, and not this evil corporation they are so happy to slap down.
Closed down a fund and directed some money to bank and residue to purchase units in another fund. No news for 16 days then found units purchased in wrong fund, which was going down. Alerted “advisor” and requested reversal into nominated fund. After total 43 days, original requested transaction completed. Now starts the battle for loss incurred . Take maybe 100 days if any result at all
Reading the sequence you have typed above this is pretty much your own fault.
Most people with operations or admin experience would pick up the problem straight away.
If you were closing down a fund, deal with that first. If that fund is in cash, some to bank then some to your other fund (as you requested).
After that, then deal with the new investment from the fund you retained – which now has a higher balance of course.
No wonder it’s mess as your instructions sound messy to begin with.
Most superannuation complaints are about Industry Funds. Love it.
Just for clarity, can you point to the bit where it says it is industry funds.
“delays in the early release of super accounting for a significant proportion of disputes”
Who do you think had most of the “delays” and failed to respond adequately to member queries?
The correlation to complaints and market downturns is well known. Also, the number of complaints increases after bad press (eg a Royal Commission). It is patently obvious that most complaints are therefore vexatious claims. I agree entirely with Disenchanted DFP below. It costs nothing for a client to complain, and the Adviser is effectively blackmailed to pay restitution because the alternative is more time consuming and costlier.
Waiting for the ASIC release stating that this has been caused by advisers. We get blamed for everything else!
It’s amazing how those AFCA complaints keep skyrocketing when there are no advisers left to liaise with the admin centres. Welcome to the nightmare. Maybe the adviser’s staff do a lot more administration follow up (that no one wants to pay for), than people realise.
Question, is it ever the case that consumers are indeed morons?
Go read some AFCA rulings. Its quite common to cry wolf it would seem.
The new norm. Fund members will not cope with trying to service the masses and what they offer will be next to meaningless. The role advisers have played has been totally misunderstood. The Royal Commission had a mandate to highlight the bad apples rather than formulating a strategy for the future of financial planning service and advice. All they have done is blown the whole industry up. The new norm has cost millions of jobs and services the average person needs will not be accessable. Advice businesses will have smaller number of clients paying higher fees and employ fewer people. Less opportunities for graduates and full time roles. Focus will be on outsourcing work overseas to save costs, wiser use of technology to reduce wages and part time contract workers .
As usual, complaints go up when markets go down. Happens every time, no matter what advisers do.
A client phoning in distress ( how dare they complain or get worried or have emotions ) – an opportunity to serve or a number to get off the line ASAP to meet a target ? The new norm.
There has been a big correction every decade I have worked.
Everyone has the same return utility – love gains on the up, hate losses on the down.
If advised clients are fretting about markets, then either;
a) the Adviser hasn’t done their job well enough explaining how investments work, or
b) you should not have taken on this client as they simply don’t and never will ‘get it’, they’re a complaint risk and you should have known better.
Best selective who you work with. Those who hold through the cycle always win.
I suspect that the comments made by Mr Understeiner are true to an extent and institutions guilty of this conduct must lift their respective games.
However, I’m sure their are a significant number of complainants, who are complaining for no apparent reason other than they can…and for no cost. And why not? They can have a whinge & whine about alleged (usually non-existent) issues with no detriment to them.
As we all know, it’s free to the consumer, but ties up valuable time & resources of advisers/AFSLs/AFCA. There needs to be a better triage system in place, plus a right of appeal.
I’m probably considered to be barking mad making these comments, and I’ll need to wait until pigs fly over a frozen hell before anyone wakes up to the folly of this.
The only area where you were barking mad was to say that the comments were true to an extent. Most people are morons and because they wanted the money on Monday it should have been paid on that day, despite them asking for it on the Tuesday. Funds knew the ATO was keeping an eye on how long it took them to make the payments and therefore they were processing them quickly.
I don’t think you’re barking mad at all. Your suggestions are good ones and I agree that more equity needs to be brought to this complaints system.