Xenophon questions future of FOS
The Financial Ombudsman Service (FOS) should be disbanded and replaced with a Government-funded statutory body, according to key independent Senator, Nick Xenophon.
The Senator has made the call in reaction to revelations in the Victorian Supreme Court around FOS's handling of a complaint made by a marketing firm and the various claims made by FOS about why it could not handle the matter, including staff shortages.
The fall-out from the court case and a submission to a Senate Committee prompted Senator Xenophon to question the status of FOS and the nature of its funding by the industry it was established to adjudicate upon.
Speaking on national television (ABC 7.30), Xenophon said it represented "a very serious case that relates to issues of the credibility of this service."
"Sooner rather than later we need to go down the path of a statutory scheme that is supported by state and federal governments, that actually has real teeth."
Senator Xenophon said the manner in which FOS had handled the case raised serious questions about the way in which it operated and that unless it could provide a valid explanation it was finished as a credible body to handle disputes resolution.
Superannuation disputes are handled by the Superannuation Complaints Tribunal (SCT) — a statutory, Government-funded body.
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