Three-quarters of AFCA advice complaints relating to Dixon Advisory
Over 1,700 investment and advice complaints received by the Australian Financial Complaints Authority (AFCA) last year related to the collapse of Dixon Advisory, representing three-quarters of total sector complaints.
The Australian Securities and Investments Commission (ASIC) commenced civil penalty proceedings against Dixon Advisory and Superannuation Services (DASS) in September 2020 for alleged conflicts, best interest failures and inappropriate advice and its Australian financial services licence was suspended in April 2022.
Consumers were urged to contact AFCA to see if they were eligible for compensation under the potential Compensation Scheme of Last Resort (CSLR).
Speaking at the AIA Adviser Summit, Shail Singh, acting lead ombudsman for investment and advice, said overall numbers of advice complaints were down once Dixon Advisory ones were excluded.
“The trend in advice is a continued improvement and numbers have been down on previous years. We received 2,211 complaints, a number of which related to Dixon Advisory. If you deduct the Dixon Advisory complaints then we had 483 complaints received which is down 47% from the previous year. So the trend in advice complaints is down and that’s a good one," he said.
“Looking at those 483 disputes, a number of them related to systemic issues such as a financial firm engaging in a business model that has risk involved such as taking low balance SMSFs and moving them into property. There were a number of other ‘batch’ complaints which were more issues with a business model."
Singh was unsure of the reason behind the significant downturn but felt it was a positive step for the industry in its development and improvement.
“It is hard to say exactly what has led to the reduction, some might say it is because there are less advisers, but if you look at the nature of the disputes, the character has changed and the type of issues are much more tricky and less straightforward.
“I feel really positive [the industry] is heading the way of a profession looking at the disputes and the nature of them.”
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Laura Dew
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