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Additional financial dispute resolution By Lawrence JohnstonDISCUSSION papers on consumer complaints about financial service providers have been released. Releasing the papers, Consumer Affairs Minister Heather Roy said it was vital for consumers to have easy access to quality dispute resolution. New Zealanders used financial services daily and, while things worked well most of the time, consumers needed access to good dispute resolution if something went wrong. Examples included the Banking Ombudsman and the Insurance & Savings Ombudsman schemes, which service the banking and insurance sectors respectively. While both these schemes had provided consumers with independent dispute resolution for years, other financial service consumers did not have such access, she said. The Financial Service Providers and Financial Advisers Acts - to be enacted in 2010 - would change that, requiring that all financial service providers be registered. Those providing financial services to the public must be members of either an approved dispute resolution scheme or a reserve dispute resolution scheme which she had to set up under the Act. Mrs Roy encouraged financial service providers to form draft guidelines towards creating their own dispute resolution schemes. That was why the first paper released, focused on draft guidelines to assist those applying to become an approved scheme. The second paper sets out the proposed reserve scheme operating rules and governance arrangements. The new Act requires a reserve scheme to be established for those providers not able to co-ordinate themselves to form their own scheme. "The disputes resolution framework is critical to the overall implementation of the new legislation, and will be implemented by May 2010. Financial service providers, including financial advisers, will have until December 2010 to register. Inviting the public to make submissions on the schemes outlined in the papers released, Mrs Roy said the need for sound regulation of the finance sector had been heightened by the collapse of many finance companies and the current global economic climate. This framework was one of a number of responses to address the issues in the finance sector, she said. |
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