The Australian Financial Complaints Authority (AFCA) has received a number of complaints about the Sterling Group of companies.

AFCA understands that this may be a difficult time for many people involved in this matter and we are working to resolve complaints as quickly as possible.

When dealing with complaints, AFCA follows its Rules and Operational Guidelines. AFCA notifies financial firms when it receives a new complaint and encourages them to resolve it directly with consumers where possible. Standard timeframes are applied. If the complaint is unable to be resolved, AFCA will allocate the complaint to a case worker.

The majority of complaints relating to the Sterling group of companies were received by AFCA in December 2019 and January 2020 and have been managed within appropriate timeframes.

These are extremely complex cases, and as an independent dispute resolution service, we must rely on the facts. We always contact both parties to a dispute, to seek clarification, information and documentation.

AFCA has had issues with a number of cases, where complainants appear to be operating under advice from an external party or advocate and have received instructions which do not support the resolution of their matter.

For instance, rather than providing the information required to allow a proper investigation of facts, some complainants are providing standard pro-forma responses, which hamper our attempts to resolve the issue, and cause delays.

Several complainants have in recent times withdrawn their complaint from AFCA. This appears to again be due to advice from an external party. We believe this advice poses a risk to consumers, as it may hamper their access to compensation.

In 2019 the Government announced its intention to establish a compensation scheme of last resort (CSLR), for cases where consumers have a claim, but the firm is insolvent. The scheme has not yet been established, and the Government has not yet announced the final scope of the CSLR, however, there may be a risk that consumers who withdraw their complaint from AFCA may not be able to access this compensation in the future.

Published: 27 March 2020

Media enquiries media@afca.org.au

About AFCA

The Australian Financial Complaints Authority (AFCA) is a non-government ombudsman service providing free, fair and independent help with financial disputes. It is a one-stop-shop for consumers and small businesses who have a dispute with their financial firm, over things such as banking, credit, insurance, advice, investments or superannuation. Where an agreement cannot be reached between parties, AFCA can issue decisions that are binding on financial firms.