ASIC gives thumbs up to AFCA rules

ASIC is required to approve material changes to the AFCA scheme under the Corporations Act, 2001. This is a key part of ASIC’s role in overseeing the operation of the new scheme.

"ASIC’s approval marks another milestone towards the AFCA scheme’s commencement on 1 November 2018," ASIC deputy chair Peter Kell said. 

"The approval of the AFCA rules and the IA terms of reference follow a period of public consultation and feedback, and both AFCA and ASIC appreciate the timely contributions from industry and consumer representatives to that process. Further material changes to the AFCA scheme will also need to be approved by ASIC," he said.

AFCA chair Helen Coonan also welcomed ASIC’s approval.

"AFCA will provide consumers and small business with access to fair, free and independent complaint resolution," said Ms Coonan.

"We look forward to working with ASIC, and consumer, small business and industry stakeholders in implementing this important reform, which will assist in restoring trust and confidence in the financial services industry.’

It is a statutory requirement that financial firms, including most credit representatives, that deal with retail clients must join the AFCA scheme by 21 September 2018.

Almost all Financial Ombudsman Scheme members have effectively transferred their membership to AFCA. About 80 per cent of members of the Credit and Investments Ombudsman Scheme and about 64 per cent of superannuation trustees and retirement savings accounts providers have also joined up. 

AFCA is providing regular membership updates to ASIC so that the regulator can monitor financial firm compliance with the statutory membership deadline.