CIO rejects single financial services tribunal



The Credit and Investments Ombudsman (CIO) has rejected the Coalition Members' recommendation that a single tribunal should be established for all financial services complaints.
The CIO said the recommendation to the House of Representatives Standing Committee on Economics in their report on the Big Four banks was a political solution to the reputation problems of the Big Four.
CIO chief executive and ombudsman, Raj Venga, said: "Unfortunately it is the innocent smaller players within the financial services sector who will pay the price. This is clearly a win for the big four banks".
"The Tribunal solution, or indeed one which involves a single ombudsman scheme, will force all small financial services providers to join a scheme which is set up to deal with the big four banks," Venga said.
"This is all fine if we want our financial system to remain uncompetitive. Larger dominant providers can afford high costs and simply pass the inefficiency on to consumers in the form of high rates and charges.
"If we want efficiency for the benefit of all consumers and the economy, we need a system of dispute resolution which facilitates increased competitiveness in financial services."
The CIO called on the Government to target its response to the problems in the sector and to the organisations which had caused them.
"If a tribunal is politically necessary, we suggest that its scope is limited to the areas that the existing Ombudsman schemes do not cover," Venga said.
"This way the very successful Ombudsman schemes already operating in Australia will be left alone to continue their highly valuable work."
Recommended for you
The new financial year has got off to a strong start in adviser gains, helped by new entrants, after heavy losses sustained in June.
Michael McCorry, chief investment officer at BlackRock Australia, has detailed how investors are reconsidering their 60/40 portfolios as macro uncertainty highlight the benefits of liquid alternatives.
Having reset its market focus to high-net-worth advisers, Praemium’s administration solution has been selected by Bell Potter in a deal that increases the platform's funds under administration by $6 billion.
High transition rates from financial advisers have helped Netwealth’s funds under administration rise by $3.7 billion in the fourth quarter of FY25.