Complaints against planner plummet

By Liam Egan

Consumer complaints against financial planners have fallen dramatically, prompting claims that measures taken to clean up the profession have started to pay dividends.

The Financial Industry Complaints Services (FICS) is due to announce that complaints aimed at advisers fell by more than one-third to 284 during 2004, down from a height of 419 in 2003.

The results, due to be released officially as part of FICS’ annual report in May, are even more remarkable given the fall occurred against the backdrop of a 4 per cent overall increase in complaints — from 9,519 in 2003 to 9,878 last year.

Each of the other three industry sectors covered by FICS — life insurance, stockbroking and funds management — registered an increase in complaints in 2004.

FICS national relations manager Trevor Slater could offer no reasons for the fall in financial planner complaints.

But the Financial Planning Association (FPA) claimed the figures were proof that measures taken to improve adviser practice were working.

As well as implementing Financial Services Reform over the past year, the financial planning industry has introduced a new code of conduct on soft dollar remuneration and guidelines on taking rebates from platforms and fund managers.

FPA professional standards manager Paul Shevtzoff said the FICS statistics were a sign of the increasing professionalism of the financial planning sector.

“There’s been a demonstrable increase in the professionalism of financial planners over the last year or 18 months, and the FICS statistics are further evidence of this,” he said.

“The statistics are also a reflection of recent surveys by RMIT University and other bodies, which show a high level of consumer appreciation of the financial planner services they’re getting.”

Meanwhile, Slater confirmed that FICS had recently “investigated and finalised” its first ever case against a financial services group for trying to pass on a FICS complaint fee to a consumer.

Slater would not comment on any details of the case, except to confirm that it had been “resolved by mutual agreement”.

“Let’s just say the member has recognised it was an incorrect thing to do, and has rectified the situation,” he said.

Of the 9,878 complaints received by FICS last year, a total of 933 made it to the ‘accepted’ complaints stage.

The number of complaints ‘finalised’ by FICS in 2004 was 1,758, which included complaints received in 2003 and 2004.

Of the 1,758 finalised complaints, 625 were finalised by mutual a agreement brokered by FICS and 495 were finalised by either the FICS panel or adjudicator.

The balance of 638 complaints were ‘finalised’ after they were rejected by FICS.