AFCA Consultation on Rule Changes Commences

The Australian Financial Complaints Authority (AFCA) has commenced public consultation on proposed changes to the rules that govern its operations, with a major focus on expanding its jurisdiction to cover receiving banks in scam complaints. 

The consultation follows a significant update to AFCA’s authorisation conditions by the Federal Government. These changes aim to strengthen complaint-handling processes, increase transparency, and elevate industry accountability, particularly in the fight against scams, which have become an increasing concern for consumers and financial institutions alike. 

Key Proposed Rule Changes 

AFCA has proposed a number of amendments aimed at improving efficiency, transparency, and consumer protections: 

• Consideration of a receiving bank in a scam transaction: This condition would enable AFCA to investigate and consider scams involving mule accounts and the actions of receiving banks in scam complaints.  
• Naming Non-Compliant Financial Firms: AFCA would gain the authority to publicly name financial firms that fail to comply with its determinations, provided the consumer has accepted the outcome.  
• Streamlining Communication from Paid Representatives: Under the new rules, paid representatives must use the correct communication channels, such as AFCA’s consumer portal, to submit and manage complaints.  
• Dealing with Non-Member Paid Representatives: AFCA is proposing a new rule that would allow it to stop handling a complaint if the paid representative involved is required to be, but is not, an AFCA member. 
• Removal of Legacy Rules Section: With the closure of AFCA’s legacy jurisdiction as of June 2020, the organisation is proposing to formally remove this outdated section from its Rules. Existing legacy complaints will not be affected. 

AFCA conducts an annual review of its Rules to ensure they remain current and relevant. Public consultation plays a critical role in this process, allowing AFCA to gather insights from key stakeholders including financial firms, industry bodies, and consumer advocates.

Consultation on AFCA’s proposed rule changes closes Friday 13 June.