ASIC approves AFCA rules

The Australian Securities and Investments Commission (ASIC) has approved the Australian Financial Complaints Authority (AFCA) complaint resolution scheme rules and the terms of reference of the AFCA independent assessor (IA).

ASIC is required to approve material changes to the AFCA scheme under the Corporations Act 2001 as this forms a major part of the corporate regulator’s role in overseeing the operation of the new scheme.

It is a statutory requirement that financial firms including most credit representatives that deal with retail clients must join the AFCA scheme by 21 September.

Thus far, almost all Financial Ombudsman Scheme members have transferred their membership to AFCA, while about 80 per cent of members of the Credit and Investments Ombudsman Scheme and about 64 per cent of superannuation trustees and retirement savings accounts providers have also joined.

ASIC deputy chair Peter Kell said: “The approval of the AFCA rules and the IA terms of reference follow a period of public consultation and feedback, and both AFCA and ASIC appreciate the timely contributions from industry and consumer representatives to that process.

“Further material changes to the AFCA scheme will also need to be approved by ASIC.”

AFCA board chair Helen Coonan said the body will provide consumers and small business with access to 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,” Coonan said.

AFCA is providing ASIC with regular membership updates so the corporate regulator can monitor financial firm compliance with the statutory membership deadline, ASIC said.

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