As of 1 November 2018, the Australian Financial Complaints Authority (“AFCA”) officially began accepting all consumer complaints and the Financial Services Ombudsman’s Service (“FOS”), the Credit and Investments Ombudsman (“CIO”) and the Superannuation Complaints Tribunal (“SCT”) have ceased to operate.

Are you Prepared?

For all licensees who have joined AFCA, there is additional work that is required to be completed in order to ensure you have effectively transitioned from your existing external dispute resolution body to AFCA.

Step One: Notify ASIC of your AFCA Membership Details

The deadline for notifying ASIC of your AFCA membership details is 30 November 2018.

If you are an AFSL holder, you will need to:

  1. Login to the AFSL Portal via ASIC’s website and prepare an ASIC Form FS20.
  2. Select the option to update ‘Addresses, business names, contact details, dispute resolution’ information.
  3. Select the ‘Dispute Resolution’ tab and input your AFCA membership details.

If you are an ACL holder, you will need to:

  1. Login to the ACL Portal via ASIC’s website and prepare an ASIC Form CL20.
  2. Select the option to update ‘External Dispute Resolution Schemes’ information and input your AFCA membership details.

Step Two: Update Documents and Website to Reflect the Change to AFCA

As a result of the transition, all documentation and information on your website that refers to CIO, FOS or the SCT needs to be updated.

Different timeframes apply to various types of documents, including:

  • Disclosure Documents such as FSGs, PDSs and Credit Guides should be updated to refer to AFCA only by 1 July 2019
  • Complaints Information on your website, details of FOS/CIO/SCT must be updated with AFCA’s details by 1 November 2018.
  • IDR Delay and Final Response Letters can refer to both FOS/CIO/SCT and AFCA until 1 February 2019. From 1 February 2019 these letters must only refer to AFCA.

For further information refer to ASIC Media Release 18-158MR which sets out the timeframes.

Background Information

The AFCA transition deadline was 21 September 2018, any licensees and representatives who have failed to join the scheme by the deadline can expect to hear from ASIC. Credit representatives that are required to join AFCA must have done so by 1 November 2018 to avoid their authorisations becoming invalid. Any credit licensee who did not join the scheme by 1 November 2018 are required to cease engaging in all credit activities.

If you are yet to transition over to AFCA from FOS, CIO or SCT, you are likely to be in breach of your licence obligations and are at risk of having your licence suspended or cancelled by ASIC. In Media Release 18-324MR, ASIC noted that while more than 35,000 financial firms have already joined the scheme there are still more than 300 licensees and credit representatives who are yet to join AFCA.

ASIC is receiving regular membership updates from AFCA and is contacting licensees and representatives who have not taken out AFCA membership or responded to AFCA communications.

Licensees and credit representatives that have not applied for AFCA membership can do so immediately via the AFCA website: https://secure.afca.org.au/Register.

For further information on the AFCA transition you can refer to any of our previous blog articles:

Any licensees or representatives who would like further information on transitioning over to AFCA or for assistance in updating legal documentation can contact us directly.

Ivana Josic

Ivana is responsible for all Marketing activities for Sophie Grace and assists both the Compliance and Legal teams with a particular focus on Compliance services. Ivana focuses on website development, management and ensures clients receive the latest regulatory updates through Sophie Grace social media channels, the newsletter and website blog page. Ivana also assists the Compliance team with drafting and amending compliance documentation, preparing AFSL and ACL Applications and implementing ongoing compliance solutions.