Try fixing the issue directly with your financial adviser and their firm first.
If the issue is not dealt with satisfactorily, you can make a complaint to the relevant dispute resolution body.
Financial planning practices should be equipped to handle complaints and let you know how this is done.
Financial advice should help you to achieve your financial goals and objectives, but there may be times when the advice provided to you may not be appropriate. If you feel something has gone wrong, it's important to know what to do.
When things go wrong, there are avenues to rectify the issue directly with the financial adviser or to make a complaint to relevant authorities as a last port of call.
How to complain about a financial adviser
If you feel that the service or advice you have been provided is inadequate, you should try to flag the issue with the adviser first. It is possible to resolve many complaints quickly once raised with the adviser, and it may amount to only a minor misunderstanding.
However, if the response is not satisfactory, you should direct your complaint to your adviser's licensee (the AFS licence holder) using the adviser's internal dispute resolution (IDR) process, the details of which can be found in their financial services guide (FSG).
If you're still unhappy with the response, you should contact the Australian Financial Complaints Authority (AFCA), which is the industry's external dispute resolution (EDR) scheme. Further, you may also make a complaint about the adviser to their industry association or professional body.
How does internal dispute resolution work?
Your financial services provider will have a complaints area that you can contact by phone, email or letter. You should explain what your complaint is about and what you would like the outcome of your complaint to be.
Before lodging a dispute, your financial services provider must be given an opportunity to resolve the dispute with you directly. In most cases, the financial services provider has up to 45 days to respond to your complaint.
If you are still unhappy with the response, what can you do?
External dispute resolution (EDR)
From November 1, 2018, all existing dispute resolution schemes for financial services, credit and superannuation complaints were amalgamated into a single scheme, the Australian Financial Complaints
Authority (AFCA). AFCA has several compensation caps and can award up to $1,085,000 regarding most claims of direct financial loss. However, if a financial adviser has provided advice under a superannuation trustee's AFS licence then there are no monetary limits, as it falls within AFCA's definition of a superannuation complaint.
Note: It is encouraged that all internal dispute resolution schemes are exhausted before taking your complaint to AFCA.
Court action
Whether or not AFCA decides in your favour, if you are still unhappy, you are not bound by its decision and can seek legal advice and take the matter to court.
Consider
As outlined on its website, when thinking about making a complaint to AFCA, you should look at the following actions:
- "Identify the issue you want to complain about.
- "Work out if you want to authorise someone else to complain on your behalf.
- "Think about what type of loss you have experienced, and what sort of outcome you want to achieve.
- "Collect any relevant documents that will help support your complaint.
- "Find out where you can go for help if your complaint is outside AFCA's domain.
- "Read through the AFCA process, including timelines, and make sure you understand the process for your complaint."
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