Complaints against planners plummet

By Ross Kelly

Complaints by consumers against financial planners plummeted yet again in 2005, according to the industry’s chief complaints resolutions service, which has also won a landmark court victory against an insurance giant that challenged one of its decisions.

According to data the Financial Industry Complaints Service (FICS) intends to officially release in its annual report in May, complaints against financial planners in 2005 that progressed to investigation dropped to 189 from 284 in 2004.

This is the second year in a row complaints against financial planners have fallen. In 2003 they numbered 419, which means the number of complaints have fallen by more than 50 per cent in just two years.

Most complaints against planners were for ‘inappropriate advice’, while only 10 per cent were related to non-disclosure of fees.

Meanwhile, FICS chief executive Alison Maynard said a ruling for FICS against Axa in the Victorian Supreme Court would have little impact on the direction of proposed changes to FICS’ rules.

Last year, Axa took FICS to court in an attempt to have a FICS ruling against it overturned. But the court ruled the FICS decision was correct.

FICS is currently considering changing its rules to allow its final decisions to be reviewed, a move prompted by the separate Masu Financial Planning case, where the courts overturned a FICS decision.

“I think the [Axa ruling] is not that significant to what we’re doing because we’re looking at a review on certain grounds more similar to those that arose in the Masu case — there would have been more impact, of course, if the Axa ruling had gone the other way,” Maynard said.