The latest data on financial advice complaints is an encouraging development for the profession, and is clear evidence of the high quality of financial advice consumers are receiving from financial planners, says the Financial Planning Association of Australia (FPA).
According to the latest Australian Financial Complaints Authority (AFCA) data from 1 July 2021 to 30 June 2022, 610 complaints were received related to financial advice. This is down over 50% from last financial year when 1,238 complaints were received, and now represents just 0.8% of all complaints received by AFCA.
Meanwhile, 672 complaints relating to financial advice were closed over the same period. Of these, 110 (16%) of them were closed at the Registration and Referral stage of the process, while 235 (35%) were resolved by agreement between the adviser and the client.
At the Determination stage, 50% were resolved in favour of the planner.
FPA Chief Executive Officer, Sarah Abood, says the latest figures are a positive development for the financial planning profession.
“It is encouraging to see a fall in the number of complaints which highlights the ongoing professionalism of financial planners right across the country,” she says.
“Not only are the absolute numbers of complaints falling, but in many cases complaints are being resolved in the planner’s favour.”
Abood says the design and implementation of the Compensation Scheme of Last Resort (CSLR) should ensure that consumers are covered for the full range of matters considered by AFCA, including managed investment schemes.
Further, she says the Government should bear the costs of the establishment and any legacy claims relating to the scheme.
“The administration costs of a CSLR should be closely monitored to ensure that cost recovery from industry primarily compensates consumers rather than covering bureaucracy and administration,” Abood says.