Australian Financial Complaints Authority expels 680 financial firms

Maria Nikolova

These 680 financial firms have failed to pay their AFCA membership levy and, hence, they now lose their AFCA membership.

The Australian Financial Complaints Authority (AFCA) today published the details of 680 financial firms who have failed to pay their AFCA membership levy. These financial firms and authorised credit representatives have been expelled from membership of AFCA, the nation’s single external dispute resolution scheme for complaints about financial firms.

Financial firms which are members of AFCA are required by law to pay a membership levy, along with fees for complaints received about them. Being a member of AFCA ensures financial firms meet their ASIC obligations when you are operating as an Australian Financial Services Licence, Australian Credit Licence, Australian Limited Financial Services Licence or Authorised Credit Representative.

The body explains that it has tried to contact the financial firms and encourages them to contact its member team as soon as possible to discuss payment options for any outstanding fees and reinstate their membership.

Let’s recall that, membership in the single dispute resolution scheme is compulsory for all AFS licensees, Australian credit licensees, superannuation trustees and other financial firms that provide services to retail clients.

During its first year of operation, AFCA saw Australians in dispute with their bank, insurance provider, super fund, or other financial firms lodge 73,272 complaints with the financial sector’s new ombudsman. This represents a 40% increase in complaints received compared to AFCA’s predecessor schemes, which in the 2017/18 financial year received a combined total of 52,232 complaints. They have been awarded $185 million in compensation during the period between 1 November 2018 and 31 October 2019.

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