The last independent review of the financial ombudsman took place in 2008, before the merger of FOS’s predecessor schemes under a single Terms of Reference.
The current review is a result of the requirement contained in the Australian Securities and Investments Commission’s (ASIC’s) Regulatory Guide 139 that independent reviews take place every five years.
Melbourne-based consultancy Cameronralph Navigator has been selected by the FOS board (in consultation with ASIC) to undertake the review.
The review will assess the operations and procedures of FOS against RG 139 benchmarks of accessibility, independence, fairness, accountability, efficiency and effectiveness.
An issues paper released by Cameronralph Navigator said a number of issues identified during the finalisation of the FOS Terms of Reference in 2009 would be considered, including the effectiveness of the $3,000 compensation cap for third party insurance.
The review will also look into whether or not FOS is adequately noted, given the 19 per cent increase in complaints in the 2010/2011 year and the 51 per cent increase in the year before that.
“We would welcome views as to whether the increased volume of complaints has appeared to manifest itself in increased pressure on parties to complaints to settle on a basis that they may not be comfortable with,” said the issues paper.
The issues paper also noted the recent research conducted by FOS into the views of its stakeholders.
“Along with our own stakeholder consultations and submissions we receive, we will also use the FOS stakeholder research to inform our review, as appropriate,” said the issues paper.
Submissions are due by 11 October, and Cameronralph Navigator will report to the FOS board on 13 December.
