Review calls for change to complaints process
TheFinancial Industry Complaints Scheme (FICS) has agreed to undergo major changes after an independent review called for a revaluation of its complaints handling procedures.
The review, the first into the complaints handling organisation since it was approved by theAustralian Securities and Investments Commission(ASIC) in 1999, found it needed to place a greater emphasis on conciliation between opposing parties, as well as improve its accessibility to consumers.
The review also called for an improvement in the skills of FICS’ case managers, particularly in the areas of negotiation, conciliation and interpersonal communications.
Conducted by La Trobe University professor Tania Sourdin, the review involved interviews with consumers who had used FICS, as well as a survey of FICS’ member organisations in the financial services sector.
The chief executive of FICS, Alison Maynard, says most of the report’s recommendations will be adopted.
“Most importantly, we will be revising the case management process and adopting new approaches to conciliation,” she says.
This is likely to include a scrapping of FICS’ Advisory Letter process. Under this system, FICS case managers often issued a written opinion to complainants about the merits of their complaint.
However, the system was seen as likely to discourage consumers from proceeding with a complaint.
“We have decided to virtually eliminate or minimise the use of the Advisory Letter process,” Maynard says.
The system is likely to be replaced by more telephone based and face-to-face conciliation sessions between opposing parties at an earlier stage of the complaints handling process, Maynard says.
She says FICS case managers will also undergo further training in conciliation techniques and on the different financial services products offered by its member organisations.
FICS was initially set up to handle complaints in the life insurance industry, but has since grown to encompass complaints in the superannuation, funds management, stockbroking and financial planning fields.
In the group’s last annual report, complaints against financial planners were shown to have risen by 124 per cent.
Maynard says this reflects a greater awareness among consumers of the presence of FICS, as well as the recent downturn in investment markets.
Recommended for you
ASIC has launched court proceedings against the responsible entity of three managed investment schemes with around 600 retail investors.
There is a gap in the market for Australian advisers to help individuals with succession planning as the country has been noted by Capital Group for being overly “hands off” around inheritances.
ASIC has cancelled the AFSL of an advice firm associated with Shield and First Guardian collapses, and permanently banned its responsible manager.
Having peaked at more than 40 per cent growth since the first M&A bid, Insignia Financial shares have returned to earth six months later as the company awaits a final decision from CC Capital.
