Treasurer Josh Frydenberg has announced that the remit of the Australian Financial Complaints Authority (AFCA) will be expanded to consider some financial complaints dating back as far as 1 January 2008.
This would provide “expanded access to redress for consumers and small businesses harmed by financial misconduct,” Frydenberg said.
The announcement comes following, but not resulting from, the Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry.
“The Royal Commission considered cases of financial misconduct dating back to 1 January 2008. As a result of today’s direction, AFCA’s remit will be expanded to enable them to review eligible complaints over the same period,” said Frydenberg.
“As a result of this direction, AFCA will be able to consider disputes dating back to 1 January 2008 that have not previously been heard and which fall within AFCA’s current monetary limits and compensation thresholds.”
The Treasurer said that AFCA would consider eligible complaints during 12 months, from 1 July 2019 to 30 June 2020.
A statement by AFCA said the Authority “warmly” welcomed the Government’s annoucnement.
AFCA Chief Ombudsman and CEO David Locke said the organisation would work with all stakeholders to implement the changes “fairly and effectively”.
“We believe that this will provide access to justice and redress to many thousands of Australian consumers,” he said.
“In most cases, we are currently only able to consider matters that have occurred within the last six years. When a complaint has been through a financial firms’ internal dispute resolution process, this timeframe is reduced to two years.”
“This change means that many more people will be able to get access to justice and have their matters properly considered.”
The Rules of AFCA will need to be updated, involving approval by ASIC. There will be a “limited consultation” on the new Rules.
“We will be issuing guidance prior to 1 July 2019 to explain how people can raise their matters with us,” Locke said.