For many victims of financial disputes, it can be a daunting process to navigate recovering your funds. You may have tried to resolve the issue with the financial provider and have had no response or success. Where do you go next? The Australian Financial Complaints Authority (AFCA) is a non-government dispute resolution organisation providing free, fair and independent help with disputes between consumers and financial providers. It is compulsory for all Australian Financial Services Licence and Australian Credit Licence providers to be members of AFCA. To have a complaint considered by AFCA it has to be within six years after you first became aware of the loss. With an exception of the current one-year window to consider complaints dating back to 1 January 2008. AFCA is only allowed to accept legacy complaints until 30 June 2020.
We can assist you to take your complaint to AFCA. We understand the complaint resolution process from submitting your complaint to case management and final determination of your complaint to obtain the best possible outcome. We have achieved success with AFCA and currently have ongoing cases awaiting determinations. Investment Issue Our client was a user of a trading platform that allows for Contract for Difference (CFD) trading. He had many short positions in the Dow Jones Industrial Average (DJI) as he believed the US market would fall following the election of Donald Trump in 2016. On 6 February 2018 the DJI fell heavily and our client seeked to benefit from closing many of his short positions. However, the CFD provider’s app and webpage did not allow for him to close these positions. Eventually, after about seven minutes the app worked and he closed his short positions, but at a higher price. The CFD provider argued that he should have called the trading desk since the app and webpage were not operating properly.
Actions Taken to Assist & Result Achieved We wrote many submissions to AFCA, arguing that the CFD provider was at fault for not allowing our client to close his positions online. The CFD provider was ordered to pay compensation of $22,086 for not providing the best service it could. Financial Advice Issue Sixteen of our clients applied to invest $199,000 for a unit in an unregistered managed investment scheme in Western Australia. However, because the total number of scheme members exceeded 20 it should have been registered and a Product Disclosure Statement (PDS) issued as well. Investors were never provided with their units in the property scheme, which we allege is a Ponzi scheme.
Actions Taken to Assist & Result Achieved As our claims against the Australian Financial Services (AFS) Licence holder were successful, compensation was ultimately awarded for three clients through the Compensation Scheme of Last Resort. However, the AFS Licence holder declared insolvency meaning the AFCA predecessor scheme, the Financial Ombudsman Service (FOS) could no longer consider the remaining complaints. We are currently lobbying to achieve compensation for the remaining clients.
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