analysis of the adviser-client relationship michael arnold – ombudsman, investments life insurance...
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Analysis of the adviser-client relationship
• Michael Arnold – Ombudsman, Investments Life Insurance & Superannuation, FOS
Dick Viney – Ombudsman, Investments Life Insurance & Superannuation, FOS
Adj Professor Wes McMaster – www.wesmcmaster.com
Agenda
Introduction FOS Key issues in adviser - client relationship Other Feel free to ask questions at any stage
FOS Terms of Reference and process
Different TORs/process depending on whether we received dispute before or after 1 January 2010
1.
Registration
2.
Acceptance(inc jurisdictional
review)
3.
Early resolution
(via Case Manager/concil
iator)
4.
Outcome(via Recommendation/
Determination)
Complaints received pre and post Jan 2010 - process
1.
Initial enquiry(inc jurisdictional
review)
2.
Case Management/
conciliation
3.
Panel investigation
4.
Determination
Some key features of “old” and “new” Terms of Reference - jurisdiction
Complaints received pre 1 January 2010
Complaints received post 1 January 2010
Monetary limits (for financial products other than insurance)
$150k per claim,(excludes interest)
$500k per claim – compensation capped at $150k per claim(from Jan 2012 this will increase to $280k per claim)(excludes interest)
Consequential/indirect loss
Not available Consequential loss – up to $3k
Non-financial loss No compensation available for pain and suffering
Non-financial loss – up to $3k
Time limits Within 6 years Within 6 years or within 2 years of receiving final “IDR response” (as defined)
Some key features of “old” and “new” Terms of Reference - process
Complaints received pre 1 January 2010
Complaints received post 1 January 2010
Time allowed for IDR complaint
45 days in most cases 45 days in most cases
Outcome Adjudicator or Ombudsman issues final decision
• In most cases, a Panel Case Manager issues Recommendation
• If appealed, Ombudsman or Panel issues Determination
Review Matter can return to decision maker(s) on certain procedural fairness grounds
Recommendations can be appealed to a final Determination by either party
Client engagement “Know your client” “Know your product” Formulating advice Delivery of advice Implementation of advice Reviews
Key stages in adviser-client relationship
AFSL liability issues: advisers acting without knowledge/approval of licensee
When investments are frozen Causation and loss The future Recent decisions of note At FOS
Other issues
www.fos.org.au (with search facility for determinations)
www.wesmcmaster.com
Further resources
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