All AFCA Members Must Review Complaints Statistics by 31 January as AFCA Launches the Datacube

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AFCA members are required to validate data about complaints received and resolved via their online membership portal and make any requests for changes to AFCA before 31 January 2020, in preparation for AFCA’s July 2019 – December  2019 report. This change comes as a result of the Datacube launched by AFCA in November 2019 and changes to AFCA’s Approved Rules (Rules) and Operational Guidelines (Operational Guidelines) on 1 October 2019.

Comparative Reporting – Key Points

The first edition of the Datacube contains AFCA’s comparative reporting data for AFCA members with more than four complaints in the period from 1 November 2018 – 30 June 2019.

The Datacube contains information about the number of complaints received, how long it takes each member to resolve complaints and the number of times the member did not respond to a complaint.

In 2020, the following reporting arrangements will apply:

  • The reporting threshold will be 4 or more complaints received for AFCA members to be included in the comparative report; and
  • AFCA will increase the frequency of comparative reporting with:
    • Two six monthly reports (July to December and January to June); and
    • An annual version to be published with AFCA’s annual review covering the full financial year (July 2019 to June 2020).

What you Need to Do

In preparation for the July 2019 – December 2019 comparative report to be published in mid-February 2020, AFCA members are required to validate the following data by accessing their online membership portal and make any requests for changes to AFCA before 31 January 2020:

 Data you can validate for the reporting period
ReceivedThe total number and full listing of complaints received at the Registration & Referral stage.
Non-response at RegistrationThe total number and full listing of complaints which were automatically progressed from registration because there was no response and there was no error in the progression.
Progressed to Case ManagementThe total number and full listing of complaints accepted in the Case Management stage.
The total number of complaints that will appear for each product-based table.
The product categorisation of each complaint progressed which determines the comparative product group.
Closed at Case ManagementThe total number and full listing of complaints closed in the Case Management stage.
The total number of complaints by outcome that will appear for each product-based table.
The product categorisation of each complaint progressed which determines the comparative product group.

If you would like any assistance in responding to AFCA, please contact us.

Naming of Members – Key Points

AFCA’s updated Rules and Operational Guidelines allows it to:

  • name an AFCA member in determinations that are issued and published from 1 October 2019; and
  • publish its determinations in a form which identifies the members against which the complaint is made but does not identify the other parties to the complaint. AFCA will not name individual employees, agents or representatives of firms.

Parties to a complaint are able to request that:

  • certain details be changed in the determination, if those details can be used to identify a party other than the Firm (as long as the substance of the determination remains unaffected); or
  • the determination not be published, provided there are compelling reasons.

The Operational Guidelines notes AFCA may decide a determination not be published for the following compelling reasons:

  • its content would unavoidably identify third parties or reveal commercially confidential information, and this could not be overcome by editing the content of the determination;
  • revealing the outcome could threaten the safety of an individual; or
  • revealing the outcome could compromise legal or regulatory action by a regulatory body or could encourage or inform future criminal activity.

The mere fact that the adverse findings within a determination may be embarrassing to the Firm is not a compelling reason for AFCA not to publish the determination.

AFCA Members will have 30 days after the complaint has been finalised to raise compelling reasons against being named in a published determination with AFCA. AFCA will take such requests into account but will not be bound by the wishes of the Firm.

Background

On 1 October 2019, changes to AFCA’s Approved Rules (Rules) and Operational Guidelines (Operational Guidelines) came into effect allowing AFCA to name AFCA members in their determinations in an effort to increase transparency and consumer education by providing a much deeper level of detail about the issues and products that consumers are complaining to AFCA about. Additionally in November 2019, AFCA launched the Datacube, an online comparative reporting tool that allows consumers to see how a member has responded to consumer complaints brought to AFCA.

In accordance with ASIC Regulatory Guide 267 (RG 267) and AFCA’s Rules, AFCA must publish information about the complaints received and closed against each Firm, including comparative complaint data.

AFCA has developed a new approach to comparative reporting via the Datacube which will enhance transparency and provide information in a way that is accessible and useful.

Key changes from AFCA’s approach to that of predecessor external dispute resolution schemes include:

  • Improved accessibility of the data by reporting raw numbers of complaints instead of a more complicated metric;
  • Increased frequency of reporting from yearly to six-monthly;
  • In addition to product-based tables, AFCA has provided an overall table of complaints received. This information includes information about the proportion of complaints directly resolved by AFCA members and complaints where AFCA has not received an initial response from the member;
  • Simpler business size metrics to categorise AFCA members and provide comparability;
  • Enhanced reporting on complaints outside AFCA’s jurisdiction; and
  • Improved data interactivity with a new data visualisation tool.

AFCA recognises in receiving complaints it generates a rich set of data and information allowing it to identify what is causing the complaints and how they are being dealt with by members. By making this information open and accessible to the public, it will allow:

  • consumers and small businesses to make informed choices about the financial products and services they use; and 
  • for AFCA members to have a statistical understanding of how they compare with their counterparts and areas they can improve.

Additionally, ASIC’s view is that naming members in determinations can help identify conduct or market problems within firms or affecting specific products or services. It will also enhance accountability of the members performance in complaints handling and highlight where they have done the right thing.

If you would like further information on the changes or assistance dealing with an AFCA complaint, please contact us.

About The Author

Quynh Truong

Quynh works across both Sophie Grace Pty Ltd and Sophie Grace Legal Pty Ltd with a particular focus on compliance and legal services. She manages the licensing and compliance aspects of the business. She is responsible for AFSL and ACL applications, variations and assists the compliance team in the implementation of compliance reviews. She provides ongoing compliance support and assists with the preparation of legal advice, commercial agreements and disclosure documents.

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