FPA warns ASIC on social media complaints
The Financial Planning Association (FPA) has warned the Australian Securities and Investments Commission (ASIC) of the dangers inherent in allowing social media to be used as an unmoderated and uninhibited means of filing complaints against financial planning firms and their planners.
The FPA has used a submission to ASIC’s review of Internal Dispute Resolution arrangements to argue that concerns expressed through social media should not, of themselves, be considered complaints in the first instance.
“The definition of a complaint should not be loosened to elevate an expression of dissatisfaction into a matter requiring a fulsome response,” it said.
“Every expression of concern should be dealt with on its merits, but should a concern be completely frivolous, a financial services company should be able to defer handling the matter unless it is escalated appropriately,” the submission said.
In doing so, the FPA has argued that people should not be allowed to hide behind the anonymity of social media and that they should be diverted to well-defined but private channels.
“By having appropriately defined channels for consumers to lodge a complaint, it instils responsibility for the individual to verify the complaint, in writing, through the appropriate channels that will clearly determine that the content is a complaint rather than a vexatious comment,” the submission said.
It said customer verification was a must because true forms of social media such as Facebook, Twitter and Linkedin, were “completely open to abuse by scammers, hackers, social engineers and others.”
“There needs to be a valid connection between the customer and the business, and this cannot be established through social media channels, at least as they operate at present,” the submission said.
Recommended for you
The Federal Court has imposed a $10 million penalty on Macquarie Bank for failing to prevent and control unauthorised fee transactions by third parties including financial advisers.
A financial advice firm has seen a weekly decline of 10 advisers, with all moving to a new licensee, while Centrepoint Alliance continues its “growth story”.
Sequoia Financial Group has seen a top-level reshuffle as the chair of the board, John Larsen, steps down after five years in the position.
As statements of advice move into the rear-view mirror, Vital Business Partners explores how financial advisers are adopting innovative documentation strategies.
