More than 35,000 financial firms required to join the Australian Financial Complaints Authority (AFCA) have now joined the scheme.
There are more than 300 licensed financial firms who are still to join, and most of these are credit licensees who were previously members of the Credit and Investments Ombudsman. A number of credit representatives who must join the scheme are also yet to do so.
Credit licensees, and those credit representatives who are required to join AFCA, should have joined AFCA by 21 September 2018. AFCA will start accepting consumer complaints from 1 November 2018.
If licensees were not a member of AFCA as at 21 September 2018 they are in breach of their licence obligations and ASIC can immediately commence action to suspend or cancel their licence For credit representatives, if they are required to join AFCA but do not do so by 1 November 2018, their authorisation will become invalid and they will need to cease engaging in credit activities.
ASIC is receiving regular membership updates from AFCA and is contacting firms who have not taken out AFCA membership or responded to AFCA communications.
Licensees and credit representatives that have not applied for membership of AFCA can do so immediately via the AFCA website: https://www.afca.org.au/apply-for-membership/.
For further information, including membership confirmation, contact AFCA: membership@afca.org.au or call 1300 56 55 62.
Licensees and credit representatives who are leaving the industry should take steps to cancel their licence in accordance with licence conditions. These steps include resolving all open consumer complaints and complying with relevant ASIC requirements.
Background
The figure in paragraph two refers to financial firms who hold either an Australian financial services (AFS) licence or credit licence who must, as a condition of their licence, be a member of AFCA.
Financial firms including AFS licensees who provide financial services to retail clients, credit licensees, most credit representatives, superannuation trustees and unlicensed product issuers are required by law to join AFCA. Some other firms operating under a licensing exemption may also be required to join AFCA, including firms operating in the regulatory sandbox.
Further licensing information: