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Issue 32 - February 2018

Chief Ombudsman's Message

Welcome to the first edition of The FOS Circular for 2018.

The last year has proven to be an eventful one, with the announcement of the formation of the Australian Financial Complaints Authority (AFCA) and the Royal Commission into Australia’s banks and other financial services.

The Treasury Laws Amendment (Putting Consumers First – Establishment of the Australia Financial Complaints Authority) Bill passed the Senate in the final sitting week of 2017 and is scheduled for debate in the House of Representatives this month. We will keep you updated.

The Royal Commission was announced on 30 November 2017, with the Honourable Kenneth Hayne AC QC, a former High Court judge, appointed as Royal Commissioner. The public can make submissions and the Royal Commission has also directly approached a range of financial services providers, regulators and complaint schemes to seek specific information from them.

An interim report is expected to be handed down on 30 September 2018 and a final report on 1 February 2019. FOS will participate in any way required of us during that time. We will also ensure our focus remains on delivering financial dispute resolution that is fair, open, simple and accessible for all consumers to use.

The Circular has been distributed for close to nine years, with the first issue published in September 2009. Much has changed in the way we communicate since that time and we want to ensure the content we share is relevant to you. Please participate in our survey to share your views on The Circular’s content; it should only take 10 minutes.

In this edition, we launch the FOS Approach to Section 54 of the Insurance Contracts Act 1984, where the insurer may not refuse to pay claims in certain circumstances. The Approach sets out what we consider when applying section 54 to a dispute. The Approach also includes a step-by-step guide to s54, which we hope is helpful.

We received 10,422 disputes from October to December 2017. While this is consistent with the previous quarter, it’s a 14% increase compared with the same quarter in 2016.

We appreciate being notified when your organisation is undertaking a remediation program. In some instances, we are approached by consumers who are dissatisfied with the outcome of a remediation program. We have specific processes for these types of disputes and being informed of the remediation will enable us to put them in place.

Finally, in previous messages, we notified you that we would be disconnecting our old 1300 number (1300 78 08 08) on 31 December 2017. We are delaying this disconnection until 31 March 2018 to ensure everyone has sufficient time to update all external and internal communications with our free call number: 1800 367 287 (or 1800 FOS AUS). Please ensure that this number is in your Financial Services Guide or Credit Guide to comply with ASIC Regulatory Guide 165.

If you have comments or suggestions about anything you read in The FOS Circular, please contact us at You are also welcome to complete this survey.

Shane Tregillis

Chief Ombudsman