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Issue 22 - July 2015

The Code Compliance and Monitoring Team


FOS’s Code Compliance and Monitoring Team is a separately operated and funded business unit of FOS, reporting to the Chief Ombudsman.

The Team supports independent Committees that monitor compliance with codes of practice in the banking, customer-owned banking, general insurance and insurance broking industries. These Committees are comprised of an independent Chair, an industry representative and a representative of consumers and small business.  The aim is to achieve service standards within the respective industries that people can trust.

Services are funded by the industry associations responsible for the four Codes of Practice administered (Code of Banking Practice; General Insurance Code of Practice; Insurance Brokers Code of Practice and Customer Owned Banking Code of Practice).

These codes are voluntary in nature but they play an important role in the regulatory framework within the Australian financial services industry. There are over 600 members that subscribe to one or more of these Codes, in addition to their EDR scheme membership (FOS or other). The Codes are written by the industries themselves in consultation with stakeholders and are usually reviewed every three to five years.

Codes contain industry-specific standards of good practice for financial service providers to follow when dealing with people who are, or who may become, individual or small business customers.

The role of Independent Committees is to work with both industry and consumers to ensure that key promises made about service delivery are met and that financial service providers have effective systems in place to ensure compliance with those obligations and to resolve disputes with their customers, if and when they arise.

This is done by actively monitoring compliance through annual compliance statement returns, shadow shopping and own motion inquiries and investigating concerns lodged by consumers and others that the codes may have been breached.

For example, in recent years, the Committees have undertaken inquiries into a range of matters including financial difficulty obligations, the visibility and accessibility of information for consumers about the Codes and internal and external dispute resolution, chargebacks, direct debits and guarantees, amongst others.  All reports published by the Committees are available through the FOS website.

Since 2013, the FOS Code team has also conducted training courses for over 700 financial counsellors and community lawyers across Australia raising awareness about the operations of the Committees and the Codes and how to access and use the individual rights consumers have under each Code when resolving disputes with financial service providers. A Codes of Practice: Your Pocket-sized Toolkit brochure has been published specifically for advocates for this purpose.