Planners take up 1.6% of AFCA complaints
Complaints against financial planners only accounted for 1.6% of all complaints to the Australian Financial Complaints Authority (AFCA) in the last financial year.
Speaking at the Financial Planning Association’s (FPA’s) virtual congress, AFCA chief executive, David Locke, said there were 1,332 complaints out of 84,546 in the last financial year.
“We get very few complaints about financial planners. That’s the good news story. Of the financial planners that are AFCA members, under 84% haven’t had any complaints,” he said.
“That’s fantastic, we’ve had more than enough complaints about banks and insurers and we’re very happy to get few complaints about financial planners. Of the 16%, 262 complaints were about financial planners and the vast majority have had one or two complaints in a year.
“If only other sectors were like yourselves, then we wouldn’t have much business and one of my targets and KPIs is reduce numbers, not increase numbers.”
Locke noted that the majority of complaints against planners were resolved in the very early stages of the process and that allegations were usually around what advice was provided, failure to act in the best interest of the client, disputes about fees and costs, planners failing to follow the instructions that were given, and some about misleading products.
“A lot relate to record keeping and communication and that’s the key to these matters. If there is a dispute around the instructions you receive we will always be looking at the evidence. What do your records show?” he said.
“My advice would be to ensure you keep a proper audit trail, record your advice and instructions, and having clarity around fees and charges and why decisions are being made. The challenge is when there isn’t record keeping.”
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