Excluding complaints related to the collapse of Dixon Advisory, the number of complaints to AFCA in the financial advice sector has declined 23 per cent year-on-year.
In an update covering its work for completed financial year, the authority announced complaints in the investments and advice sector in FY23 was 4840, up 51 per cent from the 3207 reported in FY22.
However, AFCA noted the investments and advice sector included a significant amount of complaints due to Dixon Advisory (1726 specifically), as well as 656 complaints for foreign exchange-related Best Leader Markets which dominated the figure.
Without these, the total would have been 2458, which would have represented a decrease in complaints of 23 per cent.
For the overall context of where advice sits in the greater scheme of all AFCA complaints, without the aforementioned caveats, those 2458 advice complaints represented 2.5 per cent.
Dixon Advisory entered voluntary administration last January, with its AFSL suspended a few months later in April, and by August, ASIC encouraged former Dixon Advisory clients to register complaints to AFCA to be eligible for remediation through the Compensation Scheme of Last Resort.
In other sectors, superannuation complaints were up 32 per cent from 5286 in FY22 to 6957 last financial year, while life insurance complaints saw a 24 per cent decline from 2482 to 1898.
Consumers lodged a record 96,987 complaints in FY23, a 34 per cent increase on the previous financial year which the authority described as an “unprecedented rise”.
AFCA – which replaced the Financial Ombudsman Services, Credit and Investments Ombudsman and Superannuation Complaints Tribunal in November 2018 – has been vocal in its praise for the advice profession amid continuously declining complaints since its introduction.
AFCA advice lead ombudsman Shail Singh tells Professional Planner the message clear that the advice sector is a small part of the issues the authority deals with.
“The big problems which are scams and insurance delays are the highest, nothing to do with advice,” Singh says.
“It’s almost boring, isn’t it. Every year we’re coming out saying numbers are low and that’s exactly the way we want it.”