Threat to name, shame

Financial ombudsman warns wrongdoers

AUSTRALIA’S new ombudsman for victims of bank wrongdoing says he will do more to name culprits of “egregious” behaviour in a bid to stop scandals in the financial services sector.

Australian Financial Complaints Authority chief David Locke says he believes in the power of naming wrongdoers as a way of preventing bad behaviour.

“Transparency can play an important role in changing behaviour and improving practices,” Mr Locke said.

The mega ombudsman — the Australian Financial Complaints Authority — began taking complaints from consumers and small businesses yesterday.

Consumer advocates fear a lot of the transparency flowing from the banking royal commission that has forced financial institutions to clean up their act will disappear after commissioner Kenneth Hayne hands down his final report in February.

Last May, then treasurer Scott Morrison announced the Financial Ombudsman Service was being merged with the Credit and Investments Ombudsman and the Superannuation Complaints Tribunal to create a “mega ombudsman” for the sector called the Australian Financial Complaints Authority.

Mr Locke said while FOS had the power to name offending organisations in annual thematic reports about the industry, this was a “more opaque way” than the approach Australian Financial Complaints Authority chief David Locke says his organisation is ready to take on a landslide of new cases AFCA will pursue. “I’m keen to do much more,” he said. “More than an annual basis.”

AFCA had to be careful in protecting the privacy of victims, Mr Locke said.

Mr Locke said his organisation was ready to take on the landslide of new cases expected to hit the authority.

The organisation is expecting 55,000 complaints in first year of operation.

“We are ready for it and we are expecting it,” Mr Locke said.

From today, any consumer or small business that has an unresolved complaint relating to a financial product or service can contact the AFCA for free. its