Annual Report on Operations 2015

The Credit and Investments Ombudsman (CIO) has today released its Annual Report on Operations for 2014/15.
Key highlights for the year include:
  • more than 21,800 enquiries were received
  • almost 5,000 complaints were made against financial services providers, an increase of 7.4%
  • financial hardship complaints have decreased to 24% of all complaints received, but still feature as one of the largest sources of complaints
  • credit reporting complaints have climbed to 24% of all complaints received
  • sectors attracting the largest number of complaints were debt purchasers and collectors (40.7%), and residential lenders and mortgage managers (15.4%)
  • more than 20,000 financial services providers are now members of CIO.
“I’m pleased to note that the number of financial hardship complaints we have received over the years has decreased from a high of about 34% to a low of 24%. 
“However, if interest rates, presently at record lows, were to revert to previous levels and the rate of unemployment was to increase significantly, it is likely that many borrowers may face severe mortgage stress given housing debt levels are at record highs, particularly in Sydney and Melbourne. What may follow is a significant reversal of the downward trend we have seen in financial hardship complaints”, said Mr. Raj Venga, CIO’s Ombudsman.
CIO is required to investigate systemic issues that may emerge when dealing with a complaint. The 31 systemic issues that were identified related predominantly to responsible lending, debt collection and credit reporting. 
“Systemic issues have the potential to cause widespread harm. Our work in this area resulted in refunds and compensation of more than $1,000,000 being paid to consumers, as well as other important outcomes for consumers and industry, such as the amelioration of poor industry practices and the raising of standards across particular sectors of industry”, continued Mr Venga.
Mr Venga also noted that the practices of some small amount lenders have given rise to complaints about responsible lending and systemic issues.  “The small amount loan sector is currently undergoing regulatory review and CIO supports any policy initiative which leads to greater consumer protection and confidence in the market”, he went on to say. 
CIO’s Annual Report on Operations also sets out the number of complaints that were made against named financial services providers. “We have included an explanatory statement to give some context to our report by explaining to readers that the number and nature of complaints we receive about financial services providers may be influenced by a number of factors. For example, it may well be the case that the total number of complaints about a particular member is miniscule when compared to the size of their business,” Mr Venga concluded.

Follow this link to download a full copy of the report