The Banking and Finance Royal Commission means 2018 is your year to get even with some of the least trusted businesses in Australia. However, the Commission is already up and running, so we need to act fast to get the consumer voice in the room.
As a CHOICE supporter, what do you think are the most important priorities we should champion in our campaign for fairer financial services?
I really wish you guys would use Australian based survey forms and email programs… all this data sits on servers that do not reside in Australia so are out of Australian jurisdiction… it may not seem like a problem now but this data is kept forever by a third party… worth think about.
A few things from me… relating to the superannuation side of the Commission:
Full disclosure of fees between superannuation funds and the investment trusts/organisations they have relationships with. This includes kickbacks to the superfunds from these investment trusts/houses and who the kickbacks are paid to (this could also potentially apply to financial planners/advisers as well); and
Processes where members (esp. Industry funds) spend acrued members funds, such as to other organisations or political parties. These funds are in effect ownedby the members and such expenditure should be approved by members…otherwise should be used to for increasing fund returns. It is likely that the kickbacks from dot point 1 are used for this purpose, when such kickbacks should be owned by the members and not individuaks or other non-super organisations.
For banking, possibly duty to report non-compliances by both individuals and organisations like that which already exists in the safety and environmental legislation, should also apply to the financial/super sector. Noting penalties exist for safety/environment where individuals don’t knowingly fail to report non-compliances. I believe that this would encourage a change in culture in the sector as one would be responsible for ensuring that oneself, their co-workers and the organisation achieve compliance to the maximum extent possible/practicable.
Banks, superannuation funds and the rest of the financial system should adopt a philosophy of the customer (could be individual, business or other organsiation which deals with the financial institution) always comes first, unless, the customer specifically understands and agrees to the risk/decision being undertaken. This should comprise of a specific ‘duty of care’ towards their customers. This would remove the profit/bonus incentivisation which currently exists, whereby, decisions are made which could potentially benefit the oganisation/individuals in the organisation at the expense of the customer.
The ombudsman could also adopt a reasonable person test, whereby review of complaints or decisions made could be tested to determine if a reasonable person would believe the decision was fair and reasonable, and in the interests of the customer.
Possibly a issue which should be tackles is the international currency conversion fees which is charged when AUD is converted into another currency (usually using a credit card), either through travelling or online purchases. There appears to be collusion as the standard fee across the board, where it is charged, is 3%. I can imagine that when such transactions were manual (20+ years ago), 3% would have been reasonable for the time an effort to process such conversion. But today then the system is automated, 3% appears to be direct profit to the institution charging the fees. I can’t imagine 3% fee would be reasonable costs incurred by the institution in today’s age of electronic transactions and conversions.