10 Jul 2014

Big lift in complaints to FSCL

7:07 am on 10 July 2014

Inquiries and complaints to one of the financial services industry's largest dispute resolution schemes, Financial Service Complaints (FSCL), have jumped 85 percent to 3000 in the past year.

However, FSCL needed to investigate only 24 percent of these complaints.

FSCL chief executive Susan Taylor said of the 202 cases it did investigate, 109 were settled soon after the investigation started and most of the rest were settled through the conciliation process involving FSCL staff. A FSCL ruling was required in only four cases.

Ms Taylor said the results suggested financial advisers were mostly doing a good job of putting things right, and the rise in complaints reflected a growing awareness among consumers of the service FSCL provided.

The value of awards made as compensation to consumers was just over $786,000 in the year, up from nearly $515,000 the previous year.

"I think it reflects probably the types of financial services we cover," she said.

"We're not dealing with, for example, large insurance claims or large bank loans. We're often dealing with smaller consumer credit loans or products that are lower value-type products."

However, it was not necessarily the value of the product that was the measure of the loss - it could be that something had gone wrong which had caused a small financial loss, and it was the actual financial loss it could award compensation for, Ms Taylor said.

Most complaints were about consumer credit, followed by travel insurance.