Our Submissions offer financial services providers and consumers information about how we approach a particular issue.

2017 Submissions 

 






The Credit and Investments Ombudsman (CIO) welcomes the opportunity to make a submission in relation to the Draft Bill and related material released by Treasury for consultation.

Small Amount Credit Contract and Consumer Lease Reforms



















































































































































































































































































































































































































































































































































































































































































 





The Credit and Investments Ombudsman (CIO) welcomes the opportunity to make a submission in relation to the Treasury Laws Amendment (Putting Consumers First — Establishment of the Australian Financial Complaints Authority) Bill 2017

Senate Economics Legislation Inquiry into the Treasury Laws Amendment (Putting Consumers First — Establishment of the Australian Financial Complaints Authority) Bill 2017









































































































































































































































































































































 





The Credit and Investments Ombudsman (CIO) welcomes the opportunity to make a submission in relation to competition in Australia's financial system.

Competition in Australia's Financial System




































































































































































 





The Credit and Investments Ombudsman (CIO) welcomes the opportunity to make a submission in relation to the External Dispute Resolution and Complaints Framework.

External Dispute Resolution Framework


















































































 





The Credit and Investments Ombudsman (CIO) welcomes the opportunity to make a submission to the Review.

Last Resort Compensation Scheme









































 





The Credit and Investments Ombudsman (CIO) welcomes the opportunity to make a submission to the Review.


Select Committee inquiry into lending to primary production customers









































 





The Credit and Investments Ombudsman (CIO) welcomes the opportunity to make a submission to the Review.


Review of the Australian Small Business and Family Enterprise Ombudsman





















 




The Credit and Investments Ombudsman (CIO) welcomes the opportunity to make a submission to the Senate Economics References Committee Inquiry into the regulatory framework for the protection of consumers, including small businesses, in the banking, insurance and financial services sector

Senate Economics References Committee Inquiry into the regulatory framework for the protection of consumers, including small businesses, in the banking, insurance and financial services sector 










 



Thank you for the invitation to address this Committee. 


  1. The Credit and Investments Ombudsman (CIO) has more than 23,000 members, about 95% of whom are sole traders and small businesses; in other words, they represent the smaller end of town. CIO operates predominantly in the credit sector.  Its membership comprises non-bank lenders, mortgage brokers, debt purchasers, credit reporting bureaus, time-share operators and small amount lenders, among others.
     
  2. CIO does not have any life insurers as its members. All life insurers and banks are members of FOS. So my contribution to the Committee’s inquiry will therefore be limited.
     
  3. However, CIO has a keen interest in any debate about the future of the two ASIC-approved dispute resolution schemes in the finance sector – CIO and FOS.
     
  4. As the Committee will be aware, the government has commissioned a review, led by Professor Ian Ramsay, to see if any changes need to be made to the dispute resolution architecture in financial services.
     
  5. Professor Ramsay’s draft recommendation is for there to be a single non-statutory ombudsman scheme to replace CIO and FOS - the so-called small ‘t’ tribunal.
     
  6. We think this is, frankly, nothing more than whitewash.  It’s a politically expedient solution that fixes nothing.
     
  7. Professor Ramsay’s interim report does not even offer a glimpse of how his single non-statutory ombudsman scheme will deal with life insurance and bank scandals which have caused public outrage, invited the scrutiny of numerous parliamentary inquiries, prompted calls for a Royal Commission, and spurred the Government to commission the Ramsay review in the first place.
     
  8. The fact is a single non-statutory ombudsman scheme will not be able to prevent or address any of the life insurance or banking scandals we’ve seen in the past.  Nor will it have the necessary powers to deal with small business claims against insurers and banks.
     
  9. This is because, like CIO and FOS, the single non-statutory ombudsman scheme will not be able to subpoena a third party to attend as a witness or produce documents; it will not be able to join third parties, cross-examine witnesses, take evidence on oath, investigate criminal fraud or impose penalties.  Only a court or statutory tribunal can do this.
     
  10. For the same reason, in the context of small business loans and guarantees, the single ombudsman scheme will not be able to bind valuers, investigative accountants and receivers to its decisions, nor will it be able to enforce any decision against them. 
     
  11. Any investigation a single non-statutory ombudsman scheme may conduct in relation to life insurance systemic issues will necessarily fall short of exposing and fixing entrenched poor cultures.
     
  12. We’ve asked Professor Ramsay how his proposed single ombudsman scheme, even with increased monetary limits, would deal with life insurance and banking scandals any differently from the way FOS does. 
     
  13. This is particularly relevant because FOS has indicated that the FOS model, culture and approach should be maintained in the new ombudsman scheme. 
     
  14. It is painfully ironic that the life insurers and major banks will be the big winners of the Ramsay review – a review specifically commissioned in view of the scandals attributed to them. They know the review is a diversion to avoid a Royal Commission.
     
  15. The life insurers and banks, who are members of FOS, will benefit from a single ombudsman scheme because their ombudsman costs will be subsidised by the influx of more than 23,000 smaller financial firms (who are presently members of CIO) being forced to join a single scheme.
     
  16. Smaller and more innovative financial firms, including fintech disrupters, operating on thinner margins and not having the benefits of scale and incumbency, will be least able to absorb or pass on any increased cost that may result from an inefficient single scheme monopoly.
     
  17. The major banks, invariably the largest generators of complaints, also benefit from a single scheme because the scheme will tailor its processes to deal with their large volume of complaints, at the expense of smaller financial firms.
     
  18. And it should come as no surprise that the peak industry bodies for life insurers and banks – the Financial Services Council and the Australian Bankers’ Association - are the strongest supporters of a single ombudsman scheme that none of their competitors support.  No prizes for guessing why.
     
  19. And all this at a time when the independent reviewer, Stephen Sedgwick, in his recent issues paper for the ABA into commissions and payments made to bank staff and third parties, noted that some banks still believed that "significant change is not required."
     
  20. If this attitude and arrogance is not something that goes to the culture of an organisation, I don’t know what does.
     
  21. Can I end by assuring the Committee that CIO and FOS are fit for purpose (although there is always room for improvement).
     
  22. CIO and FOS were designed to deal with Mum and Dad complaints, as well as straight-forward small business disputes.  That they do this very well has been acknowledged by consumer advocates, independent reviews conducted in relation to each scheme, and Professor Ramsay’s own interim report.
     
  23. CIO and FOS were never intended, nor are they equipped, to expose bad behaviour by assigning and publicising moral culpability to, or imposing penalties on, financial firms.  That is beyond their remit, as it will be beyond the remit of a single non-statutory ombudsman scheme. Only a commission of inquiry will achieve this.

Thank you for your time.  I’m happy to take any questions.




 


The Credit and Investments Ombudsman (CIO) welcomes the opportunity to comment on the Interim Report by the Ramsay EDR Review Panel.

Response to the Interim Report by the Ramsay EDR Review Panel



2016 Submissions

 

The Credit and Investments Ombudsman (CIO) welcomes the opportunity to comment on the proposals contained in ASIC’s Consultation Paper 272 “Remaking ASIC class orders on time-sharing schemes”.   

ASIC Consultation Paper 272: “Remaking ASIC class orders on time-sharing schemes”

 

The Credit and Investments Ombudsman Service Limited (CIO) appreciates this opportunity to respond to the Issues Paper for the Review of External Dispute Resolution schemes.  

 

Response to the Issues Paper for the Review of EDR schemes


2015 Submissions

 

The Credit and Investments Ombudsman Service Limited (CIO) appreciates this opportunity to respond to the Discussion Paper on the Review of the Small Amount Credit Contract Laws1 (the Discussion paper).  

 

The Review of the Small Amount Credit Contract Laws

 

The Credit and Investments Ombudsman (CIO welcomes the opportunity to comment on the Treasury Legislation Amendment (Small Business and Unfair Contract Terms) Bill 2015 [Provisions].

 

Extending unfair contract term protections to small businesses: Treasury Legislation Amendment (Small Business and Unfair Contract Terms) Bill 2015 [Provisions]

 

The Credit and Investments Ombudsman (CIO)  welcomes the opportunity to comment on extending unfair contract term protections to small businesses.

 

Extending unfair contract term protections to small businesses



2014 Submissions

 

The Credit Ombudsman Service Limited (COSLwelcomes the opportunity to make a submission to the Economics References Committee Inquiry.

Economics References Committee Inquiry: Scrutiny of Financial Advice

 

The Credit Ombudsman Service Limited (COSL) welcomes the opportunity to comment on the consultative draft of the ACDBA Code of Practice (ACDBA Code). 

Consultative draft ACDBA Code of Practice

 

The Credit Ombudsman Service Limited (COSL) welcomes the opportunity to respond to the Inquiry into the Corporations Amendment (Streamlining of Future of Financial Advice) Bill 2014.

 

Inquiry into the Corporations Amendment (Streamlining of Future of Financial Advice) Bill 2014

 

The Credit Ombudsman Service Limited (COSLwelcomes the opportunity to respond to the Issues Paper of 14 April 2014.

Competition Policy Review

 

The Credit Ombudsman Service Limited (COSLwelcomes the opportunity to make a submission to the Inquiry.

Financial System Inquiry

 

The Credit Ombudsman Service Limited (COSL) appreciates the opportunity to comment on the draft National Consumer Credit Protection Amendment (Small Amount Credit Contracts) Regulation 2014.

Consumer credit regulations - Exposure Draft

 

The Credit Ombudsman Service Limited (COSL) welcomes the opportunity to make a presentation to the Senate Economics Reference Committee on the performance of ASIC.

 

COSL's opening statement to the Senate Economics Reference Committee on the performance of ASIC

 

The Credit Ombudsman Service Limited (COSL) welcomes the opportunity to make a submission to the Committee in relation to its inquiry into the performance of the Australian Securities and Investments Commission (ASIC).

Senate Economics References Committee: 'Inquiry into the performance of ASIC'



2013 Submissions

 
This submission sets out COSL’s response to ASIC’s discussion paper on credit hardship obligations.

COSL's response to ASIC's discussion paper: credit hardship obligations - outstanding issues  
 

The Credit Ombudsman Service Limited (COSL) appreciates this opportunity to respond to the Issues Paper produced by the Commonwealth Consumer Affairs Advisory Council entitled “Review of the Benchmarks for Industry-Based External Dispute Resolution Schemes” (the Issues Paper). 

Benchmarks for Industry-Based External Dispute Resolution Schemes 

 

The Credit Ombudsman Service Limited (COSL) appreciates this opportunity to respond to the Draft Credit Reporting Code produced by Cameron Ralph Navigator for the Australian Retail Credit Association (the Draft Code).

Draft Credit Reporting Code

 

The Credit Ombudsman Service Limited (COSL) appreciates this opportunity to respond to the Discussion Paper on “The exemption of retailers from the National Consumer Credit Protection Act 2009” (Discussion Paper).

The Regulation of Point of Sale Vendor Introducers



2012 Submissions

 

COSL’s response to the report by Richard St John on compensation arrangements for consumers of financial services.

COSL's response to the report by Richard St John

 

The Credit Ombudsman Service Limited (COSL) takes the opportunity to respond to the Australian Security and Investment Commission's (ASIC) Consultation Paper 172 (CP 172) on the jurisdiction of EDR schemes to deal with a complaint when it is already the subject of legal proceedings.

ASIC Consultation Paper 172 - EDR scheme jurisdiction

 

This submission sets out COSL's comments to ANZOA's view on 'Competition Among Ombudsman'.

Competition among Ombudsman: An alternative view to the ANZOA Policy



2011 Submissions

 

This submission sets out COSL's comments to the Parliamentary Joint Committee on the Inquiry into the Consumer Credit and Corporations Legislation Amendment (Enhancements) Bill 2011.

Inquiry into the Consumer Credit and Corporations Legislation Amendment (Enhancements) Bill 2011 

 

This submission sets out COSL's comments on the draft National Consumer Credit Protection Amendment Regulations 2011 and the proposed Key Facts Sheets examples (July 2011).

National Consumer Credit Protection Amendment Regulations 2011- Home Loan Key Facts Sheets

 

In this submission, the Credit Ombudsman Service Limited provides its views to the Standing Committee on Finance and Public Administration about the Exposure Drafts of the Australian Privacy Amendment Legislation: Credit Reporting.

Exposure Drafts of the Privacy Amendment Legislation to Credit Reporting

 

The Credit Ombudsman Service Limited offers its views on the proposed Key Fact Sheets for home loans and credit cards.

Key Fact Sheets - National Consumer Credit Protection Amendment (Credit Card and Home Loans) Act



2010 Submissions

 

This submission sets out COSL's views on ASIC’s Consultation Paper 138 – Dispute resolution requirements for trustee companies providing traditional services.

ASIC Consultation Paper 138 Dispute resolution requirements for trustee companies providing traditional services

 

This submission sets out COSL's views on ASIC’s Consultation Paper 138 – the Green Paper on National Credit Reform: Enhancing confidence and fairness in Australia’s credit law resolution requirements for trustee companies providing traditional services.

Green Paper - Financial Services & Credit Reform

 

COSL sets out its views about the Section E of the Discussion Paper on Credit Reporting Reform: Clarifying requirements around the new comprehensive credit reporting data sets, released by the Department of the Prime Minister and the Cabinet.

Credit Reporting Reform

The Credit and Investments Ombudsman (CIO) welcomes the opportunity to make a submission in relation to the Draft Bill and related material released by Treasury for consultation.