Last resort compensation scheme
The following consumer organisations have joined together to make this submission to the Inquiry into Scrutiny of Financial Advice:
- Consumer Action Law Centre
- Consumers Federation of Australia
- Council of the Ageing (COTA) Australia
- CHOICE
- Financial Counselling Australia
- Financial Rights Legal Centre
- Superannuation Consumers Centre
The terms of reference for this inquiry include consideration of “whether existing mechanisms are appropriate in any compensation process relating to unethical or misleading financial advice and instances where these mechanisms may have failed”. It is our view that the fact there is significant uncompensated loss incurred by investors demonstrates that existing mechanisms have failed, and there is an urgent need to establish a last resort compensation scheme for consumers who sustain uncompensated losses in the finance sector.
