June Smith

The Australian Financial Complaints Authority (AFCA) welcomes confirmation by the Federal Government that it will be the single, centralised External Dispute Resolution (EDR) scheme for scam complaints under the Scams Prevention Framework (SPF).

The SPF expands AFCA’s jurisdiction to consider the role of banks, telcos and digital platforms in scam complaints.

AFCA will be the one-stop-shop for consumers who have not been able to resolve their scam complaint through Internal Dispute Resolution.

The multi-party EDR service for SPF will be the first of its kind in the world and recognises the sophistication of modern scams, which often involve multiple organisations across different sectors.

Designated banks, telcos and digital platforms will be required to be AFCA members from Tuesday 1 September 2026, giving consumers access to an independent external dispute resolution pathway for complaints under the Scam Prevention Framework.

AFCA will be able to deal with scam complaints under the new framework from 31 March 2027.

“We welcome the Government’s announcement and the confidence it has placed in us to act as the external dispute resolution scheme under the Scams Prevention Framework. We have significant experience handling complex complaints at scale, and we’ll be using that experience to build an effective and accessible service,” said AFCA’s acting Chief Executive Officer and Chief Ombudsman Dr June Smith.

“We recognise the size of the task and look forward to working closely with all stakeholders to deliver a robust, fair and efficient dispute resolution process,” said Dr Smith.

AFCA recently appointed David Lacey as its inaugural Chief Scams Officer (CSO) to lead the establishment of the new scams EDR scheme.

“Scams are one of the most significant issues affecting consumers today. They are increasingly sophisticated and they leave people facing devastating financial and emotional consequences” said the Chief Scams Officer.

“We recognise the complex nature of modern scams and the need for fair outcomes for victims and the organisations involved. We look forward to welcoming new members to AFCA.”

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The consultation, running until 26 June, follows a recent legislative change which introduced a ban on life insurers soliciting or using protected genetic information.

The Australian Financial Complaints Authority (AFCA) is opening public consultation on proposed amendments to the rules that govern its work, following changes to genetic testing protections in life insurance.

The consultation, running from 1 June to 26 June, follows a recent legislative change which introduced a ban on life insurers soliciting or using protected genetic information (namely adverse genetic testing results) when offering life insurance.

“These proposed amendments will ensure we can consider complaints about the use of genetic testing in life insurance in line with the new protections for consumers. This will enable AFCA’s Rules to keep pace with changes in the law,” said Michelle Kumarich, Executive General Manager Jurisdiction and Systemic Issues.

AFCA is proposing changes to Rule C.1.4b) and d) to enable it to consider complaints specifically about the use of adverse genetic testing results.

Subject to consultation and regulatory approval, these amendments are expected to take effect from 8 October 2026.

“Engaging with stakeholders through this consultation is essential to ensuring our Rules continue to meet the needs of consumers and financial firms. We encourage all stakeholders, particularly our life insurance members, to have their say during the consultation.”

The Consultation page on the AFCA website provides more information on how to submit a response.

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AFCA Chief Executive Officer and Chief Ombudsman David Locke said David Lacey will lead the expansion of AFCA’s jurisdiction to consider the role of banks, telcos and digital platforms in scam complaints.

“As founder and CEO of IDCARE, David brings unparalleled experience in understanding the profound impact scams have on individuals and their families,” said the Chief Ombudsman.

“David has spent years working directly with scam victims, and that perspective will be critical in shaping a scams ombudsman service that is accessible, fair and can effectively resolve complex issues involving multiple parties.”

AFCA’s external dispute resolution service will be a key component of the Government’s Scams Prevention Framework and introduces an expanded area of responsibility for AFCA, requiring additional capabilities, systems and cross-sector coordination with new industries.

David Lacey joins AFCA from IDCARE, where he built Australia and New Zealand’s leading response service for victims of identity crime and scams. He has also held senior executive roles across government and industry in cyber and identity security, law enforcement, and national security.

“External dispute resolution will play an important role within the Scams Prevention Framework. I’m excited to build a scams ombudsman service that will consider all the parties involved in a scam and help deliver fair outcomes for consumers and firms,” David Lacey said.

The Chief Scams Officer appointment is one of several recent C-suite additions at AFCA, strengthening the organisation’s leadership team to meet future demands and the needs of the community.

“We are bringing together scams expertise with customer-focused technology and systems so AFCA is ready for its next phase of growth and can deliver the best possible service,” said Chief Ombudsman David Locke.

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AFCA Chief Executive Officer and Chief Ombudsman David Locke said the new appointments ensure AFCA has the right expertise in place to prepare for the future and meet the needs of the community.

“The demand for our service is as strong as ever and cases are becoming increasingly complex, but at the very core, we are helping people dealing with a financial issue and we know that can be very stressful for people,” said the Chief Ombudsman.

“We are strengthening our expertise so we can streamline our processes, make our service easier to use, and manage the sustained high volume of complaints we continue to receive.”

AFCA has grown considerably since it was established in 2018, and for the past two years has received over 100,000 complaints from consumers and small businesses each year. That figure is on track to reach over 110,000 complaints this financial year.

AFCA’s new Chief Customer Officer Deborah Jenkins brings significant senior leadership experience across major regulators, the public service and global professional services, where she has led large, customer-facing teams working in complex environments.

“I’m motivated by AFCA’s industry-wide impact and its use of data to strengthen consumer protection, deliver insights and deliver better outcomes. With such significant public trust responsibilities, AFCA plays a vital role in the community. I look forward to using my experience to make sure people who come to us are supported, treated fairly, and are heard,” said Deborah.

Stevie-Ann Dovico joins AFCA as Chief Technology Officer with almost 20 years of senior technology leadership across major banks and a large mutual. Her experience spans digital modernisation, data-led operations, cyber security, enterprise architecture, and cloud transformation within highly regulated environments.

“I’m excited to bring my experience in technology to an organisation that makes a genuine impact on people’s lives. AFCA’s work is grounded in purpose, and there is real opportunity to use technology to strengthen its services, improve accessibility and deliver better outcomes for the people who rely on us. This is a chance to make a meaningful contribution,” said Stevie-Ann.

Brigid Parsonson has been acting in the Chief Operating Officer role since early 2025 and was appointed following a comprehensive search process. Since joining AFCA in 2019, she has played a key role in shaping the organisation’s growth and leading major enterprise initiatives including the evolution of AFCA’s funding model and the modernisation of core systems.

“As our jurisdiction expands, my focus remains on strengthening our operations and supporting our people so we can continue delivering fair, timely and high-quality outcomes. AFCA plays a vital role in the community, and I look forward to continuing to build on the strong foundations already in place as we move into our next phase of growth,” said Brigid.

The Scams Prevention Framework will introduce a new line of business for AFCA, requiring new capabilities, systems and cross-sector coordination. An announcement about AFCA’s inaugural Chief Scams Officer (CSO) will follow in the coming weeks.“Our new leaders bring perspective, deep experience and a strong commitment to public purpose – exactly what AFCA needs as we enter our next phase of growth and continue delivering for the community,” said the Chief Ombudsman.

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David Locke

The Australian Financial Complaints Authority (AFCA) received a record number of complaints in 2025, with 111,373 complaints coming through the door – a 14 per cent increase from the 2024 calendar year.

Consumers and small business owners secured $643 million in compensation and refunds after coming to AFCA, which is another record and a 120 per cent increase from the previous calendar year.

The increase in complaints was spread across all financial products, including banking and finance, insurance, investments and advice, and superannuation.

Large scale collapses in the financial advice sector resulted in a 58 per cent increase in investment and advice complaints, including a 59 per cent increase in complaints from self-managed superannuation funds. This includes 2,162 complaints relating to the collapse of the Shield and First Guardian Master Funds.

“Shield and First Guardian complaints will continue to be a key focus for AFCA throughout 2026. We have now issued 44 decisions, including five lead decisions, and have 500 simultaneous investigations underway, and we remain firmly committed to progressing these matters as quickly as we can,” said Chief Ombudsman and Chief Executive Officer David Locke.

Last week AFCA reached a significant milestone when it issued its 1,000 Dixon determination. Complaints against Dixon Advisory are the largest single batch of complaints AFCA has ever managed. This work continues to be a focus with around 900 matters currently under investigation.

“We know that large scale financial firm collapses can have a profound impact on people and their families. We’re working through these matters as quickly and carefully as we can, and we’re making steady progress,” David said.

The 29 per cent rise in superannuation complaints (7,687) in 2025 was largely driven by delays in handling claims and disputes over claim decisions. While complaints about death benefits have remained steady, the main pressure points were timeliness and transparency in the claims process.

Since the start of operation, AFCA has received more than 634,000 complaints, helping to secure $2.1 billion in compensation for consumers.

“This data highlights the sustained demand for our service, and with a new Banking Code now in force, and major reforms underway across general and life insurance, this is a pivotal moment for the financial services sector to lift standards and deliver more consistent, accessible and customer focused outcomes for their customers,” said the Chief Ombudsman.

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June Smith

Complaints to the Australian Financial Complaints Authority (AFCA) continue to highlight the barriers Aboriginal and Torres Strait Islander peoples face in accessing financial services and products, particularly in regional and remote communities. The ombudsman has called on the industry to make 2026 count and take actionable change to improve service quality and the cultural competence of their organisations.

AFCA received 2,461 complaints from Aboriginal and Torres Strait Islander peoples in the 2024–25 financial year. Through complaints handling and community engagement, the most common issues raised include unauthorised transactions, inadequate or delayed responses to requests for financial difficulty assistance, lengthy delays in firm responses to claims and complaints, and mis‑selling of funeral and other insurance products.

AFCA also hears concerns relating to digital exclusion, which can limit people’s ability to engage with firms via technology. This is compounded by a lack of cultural understanding within firms and higher costs for First Nations people seeking to access basic banking, superannuation and insurance services, particularly in regional and remote areas.

“First Nations people continue to face disproportionate challenges and barriers when interacting with financial services and our data likely reflects only a fraction of the problem. Year after year the same patterns persist, and many people never reach external dispute resolution because of the frustration they experience dealing with firms. First Nations people deserve to be able to access every day financial services other Australians take for granted,” said AFCA Deputy Chief Ombudsman Dr June Smith.

“In 2026, we encourage the sector to come together and take advantage of the many opportunities for change, such as the independent reviews of codes of practice which could make a real difference to how First Nations people can engage and access financial services. Our goal should be economic and financial empowerment for First Nations people.”

Many regional and remote communities face limited internet access, unreliable mobile coverage, and more recently, bank branch closures. These barriers often make it harder for First Nations people to access services online and engage with representatives about the challenges and difficulties they’re having with products.

Automated services provided by financial firms, including during internal dispute resolution, can overlook signs of digital exclusion, language and cultural barriers, vulnerability, hardship or financial abuse. Firms have an obligation to make sure there are human-led checks, culturally competent staff when engaging with First Nations people and balances in place to support their customers.

“Not having digital access can have many impacts – from making insurance claims, accessing and engaging with superannuation accounts and receiving timely updates from financial firms. A priority for AFCA is equity of access for everyone, and I encourage all financial firms to think about the equity of access they offer to their own customers.”

The current independent reviews of industry codes of practices across the sector are a terrific opportunity to set consistent standards for First Nations engagement and access to services, customer service and support for vulnerable, regional and remote customers. It is also timely for industry to review the additional barriers to full financial services engagement by First Nations people.

“Now is the time for industry to clearly define its commitment to improving engagement with First Nations peoples. The new Codes should strengthen self‑identification processes, incorporate cultural practice and norms into account and personal identification requirement, require meaningful cultural awareness training, and ensure genuine service support for First Nations people in regional and remote areas,” said Dr Smith.

“We need stronger codes of practice to improve how financial services engage with First people to ensure they can access their services and have a clear path to culturally appropriate dispute resolution when things go wrong.”

As part of its commitment to reconciliation and financial inclusion, AFCA has also changed the way it manages complaints from First Nations peoples, making its process culturally informed, respectful and accessible.

“Through our Equity of Access program and Reconciliation Plans, AFCA is embarking on further improvements to how we work, to ensure every First Nations person has the same opportunity for a fair process and a fair outcome. We recognise that people come to us with different needs and experiences, and for some the process can feel daunting,” Dr Smith said.

“This program marks the beginning of a major shift in how we deliver our service, so people feel seen, heard, supported and able to participate fully in their complaint.”

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Mr Sean Hughes is currently General Counsel for Vanguard Investments Australia and brings deep expertise in financial services regulation, law, corporate governance and risk oversight.

Mr Hughes served as a Commissioner at ASIC from 2018 to 2023, where he played a key role in implementing the recommendations of the Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry.

During his time at ASIC, he also led regulatory oversight of a number of sectors, including banking, credit and payment systems, and ASIC’s response to COVID-related hardship measures for bank customers.

Prior to ASIC, Mr Hughes held senior leadership roles including Group General Counsel at Tabcorp, Chief Risk and Legal Officer at UniSuper, and Chief Executive Officer of New Zealand’s Financial Markets Authority.

As Chair, Mr Hughes will oversee the Committee’s monitoring of Code compliance, commencing a three-year term in early 2026, taking over from outgoing Chair Mr Ian Govey AM.

“Sean brings extensive experience to this role and will be a huge asset to the committee as it continues its work promoting compliance with the code, and by doing so, creating fairer outcomes for consumers,” said AFCA Chief Ombudsman and Chief Executive Officer David Locke.

“I would like to thank outgoing Chair Ian Govey AM for his service and guidance over the past six years. Ian has made a significant contribution strengthening the committee’s oversight of the code and improving outcomes for consumers,” said Mr Locke.

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Suanne Russell

Against a backdrop of high complaint numbers from small businesses to the Australian Financial Complaints Authority (AFCA) last financial year, AFCA is urging small business owners to consider the risks of dealing of with lenders that are not members of AFCA.

Under the current law, not all small business lenders are required to be members of AFCA, leaving business owners taking out loans with non-AFCA members with fewer options for redress if something goes wrong. When applying for a loan you can ask if your small business lender is an AFCA member.

In the financial year 2024-25, AFCA closed 2,063 small business complaints about “finance” with 21 per cent of them closed because they were outside AFCA’s rules. Of the small business complaints that were closed, a large proportion were not able to be considered because the financial firm was not an AFCA member.

“If a small business lender is not a registered member of AFCA, the small business cannot lodge a complaint with us if things go wrong, leaving these business owners vulnerable,” said AFCA’s Lead Ombudsman for Small Business, Suanne Russell.

“We’re seeing an increase in complaints being lodged about finance that we cannot consider, and this is a growing concern for us.”

Small businesses took 4,648 complaints to AFCA in the last financial year, a rise of 4 per cent following a record high in the previous financial year.

“For the second year in a row, we have seen a record number of complaints from small businesses. This increase underscores the mounting pressures business owners face, from cash flow and financing difficulties, to rising costs and interest rates,” said Suanne.

Business transaction accounts overtook business loans to become the most complained about financial product over the 12 month period, rising 32 per cent to 1676 complaints.

The other most disputed products related to commercial property, credit cards and commercial vehicles.

The top issue for small businesses was service quality, rising 43 per cent to 337 complaints, followed by a financial firm’s failure to respond to requests for assistance, with 310 complaints. There was also a 36 per cent increase in complaints around incorrect fees, premiums and charges, with 301 complaints.

“At a time when small business owners are facing a challenging economic environment, it’s concerning that the top three issues relate to customer service and communication,” Suanne said.

“We urge financial firms to consider the requests from their customers, meet them where they can, and communicate their decisions and actions appropriately – especially when they are dealing with small, often family-run businesses.”

AFCA can consider complaints from small businesses with fewer than 100 employees but the complaint must be lodged against a financial firm with an AFCA membership. AFCA can consider complaints about products, lending practices and conduct.

“We urge any lenders who are not yet members, especially those servicing small businesses, to consider joining AFCA, giving their customers access to external dispute resolution should they need it,” she added.

Last financial year, AFCA closed 4,017 small business complaints and secured $27 million in compensation for small businesses.

AFCA provides an independent and impartial financial complaints resolution service that is free for small businesses and consumers.

Read the 2024-25 AFCA Annual Review here.

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Shail Singh

The Australian Financial Complaints Authority (AFCA) welcomes ASIC’s updated guidance that clarifies how existing laws apply to digital assets.

Firms providing services related to digital assets that are financial products, including wrapped tokens, stablecoins, tokenised securities and digital asset wallets, are now required to become a member of AFCA and lodge an AFSL application by 30 June 2026 in line with Information Sheet 225.

“The updated guidance from ASIC requiring digital asset businesses to have an Australian Financial Services Licence means vital consumer protections are extended to investors of cryptocurrency and digital assets,” AFCA’s Lead Ombudsman for Investments and Advice, Shail Singh said.

“We expect better regulation will reduce fraud and security issues, and it also means cryptocurrency platforms will need to have internal dispute resolution processes for their customers, should they have an issue with a product,” Mr Singh said.

“Consumers will also have the right to come to AFCA, as an independent umpire, if they can’t resolve a dispute with a licensed firm.”

Until now, cryptocurrency was not regulated as a financial product under the Corporations Act, so providers of cryptocurrency or digital assets were generally not required to be members of the AFCA external dispute resolution scheme. However, some had chosen to be voluntary members or were members under a condition of an industry association.

In the 2024-25 financial year, AFCA received 159 complaints about cryptocurrency firms that were voluntary members.

The top three issues were scams, interpretation of product terms and conditions and failure to act in a client’s best interest.

Mr Singh said AFCA would work with digital asset businesses to ensure a smooth transition to the new arrangements.

“We stand ready to share our knowledge and expertise in complaint handling, with the common goal of preventing disputes in the first place and addressing those that do arise in a fair and efficient way.”

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David Locke

The complaints data in the Australian Financial Complaints Authority’s (AFCA) Annual Review, published today, demonstrates the persistent financial pressures facing consumers, as well as areas where financial firms can do better when dealing with disputes.

In the 2024–25 financial year, and for the second year in a row, AFCA has received more than 100,000 complaints.

“We know many Australians continue to feel financially stretched and stressed – and behind every complaint we receive is a person seeking fairness and resolution in a time of uncertainty,” said Chief Ombudsman and Chief Executive Officer David Locke.

“In times of economic pressure, it’s critical that financial firms strengthen their internal dispute resolution processes and ensure resources are available to deal with disputes in a fair and timely manner.”

The 2024–25 financial year saw banking and finance complaints continue to be the largest complaint type, making up 54 per cent of all complaints. Despite a 17 per cent drop in financial difficulty complaints overall, “failure to respond to a request for assistance” remained in the top five complaint types for the sector.

“We’re calling on all financial firms to stay committed to early resolution and proactive engagement with their customers, particularly those experiencing financial hardship,” said Mr Locke.

“We know more and more families are experiencing hardship due to cost-of-living pressures, and we urge financial firms to genuinely consider these requests with fairness and compassion.”

Large scale collapses in the financial advice sector continue to result in high volumes of complaints against advisers and financial advice firms – up 18 per cent from last financial year. Self-managed superannuation fund complaints significantly increased by 95 per cent and “failure to act in the client’s best interest” complaints increased a concerning 124 per cent.

“Our complaints data points to systemic issues in advice models, particularly where conflicts of interest and inappropriate use of SMSFs are involved,” Mr Locke said.

“This underscores the importance of the Compensation Scheme of Last Resort to ensure consumers have access to redress when financial advice fails to be in their best interest.”

This year AFCA’s jurisdiction was expanded to include Buy Now Pay Later (BNPL) providers, and in 2024–25, AFCA received 2,099 complaints about these products. The most common issues were credit enquiries, unauthorised transactions, and service quality.

“BNPL products continue to be popular with Australians, especially younger Australians, and we are watching this sector with interest. As providers fulfil their credit license obligations, we expect to see new complaint types emerge, including responsible lending and credit reporting concerns,” said Mr Locke.

AFCA received 34,231 general insurance complaints, a 17 per cent increase from last year, which was driven by complaints about add-on insurance. Excluding add-on insurance, general insurance complaints remained consistent with the last two years.

“Persistently high volumes of complaints about general insurance demonstrates there is more to be done by the sector to prevent complaints reaching AFCA, particularly in cases where escalation could have been avoided if the issue was simply a claim delay,” said Mr Locke.

“Proactive and clear communication with customers can often be the very thing that stops a complaint from being escalated in the first place.”

Read the Annual Review.

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