The Financial Ombudsman Service Australia (FOS) deals with a
range of disputes including banking, credit, loans, insurance and
FOS provides an independent dispute resolution procedure for
consumers and small businesses that are unable to resolve
complaints with member financial service providers
FOS only has jurisdiction over the matters specified in section
B of the FOS Terms of Reference. We will discuss jurisdiction in a
Where there is jurisdiction, there are a number of steps
involved in a FOS dispute.
Step 1: Lodge your dispute
You will only be eligible to lodge your dispute with FOS, if
your FSP is a member. As a first step, you should check that your
FSP is a member of FOS through the FOS website. You will then need
to lodge your dispute online, also through the FOS website.
Step 2: Referral
When FOS receives the complaint it will refer your dispute to
your FSP, giving them an opportunity to resolve the dispute with
If you have already attempted to resolve the dispute with your
FSP, they will only have an additional 21 days to resolve the
dispute before FOS takes further action. If the FSP was not
previously aware of your complaint, they will have an extended time
period of 45 days.
Step 3: Registration
If your complaint is not resolved, FOS will register your
dispute and commence investigations. The FSP is required to provide
FOS with an outline of its position regarding your complaint as
well as all the relevant information and documents necessary to
investigate the complaint.
At this stage, FOS will also consider whether it has
jurisdiction to consider your dispute.
Step 4: Case management
A case management officer will be assigned to your dispute and
will commence the investigation process. After reviewing all the
relevant information (and seeking further information where
necessary), the case officer will attempt to resolve the dispute by
requiring the parties to attend a negotiation or conciliation
A conciliation conference is more formal than a negotiation,
involving a third party conciliator who is a professionally trained
employee of FOS.
Step 5: Decision
If the dispute is not resolved by agreement between the parties,
FOS will make a decision about the merits of the dispute.
FOS is not a court of law and is not bound by the same legal
rules or formal technical procedures. However, in making its
decision, FOS is required to be 'fair in all the
circumstances' while having regard to legal principles,
applicable industry codes and guidance, good industry practice and
any relevant previous FOS decisions.
Both you and your FSP will be given an opportunity to make
submissions about the dispute, which will help guide FOS'
Step 6: When should you accept the FOS decision?
At first instance, FOS will make an assessment of the dispute,
called a Recommendation (unless the process is expedited because of
special circumstances). If both parties accept the Recommendation
within 30 days, the dispute will be resolved and the decision will
become binding on both parties. If either party rejects the
Recommendation, FOS will proceed to make a Determination.
A Determination is a final decision and the FSP generally has no
rights to accept or reject it. You will, however, only be bound by
the Determination if you choose to accept it within 30 days.
If you reject the Determination or do not accept it within 30
days, it will not be binding on either party and you may proceed to
take the matter to court – provided you are not out of
time to commence court proceedings.
It is important to be aware that, by accepting a FOS
Recommendation or Determination, you are accepting full and final
settlement of the dispute. The courts have taken a reasonably
strict approach to reviewing FOS decisions and will only do so in
circumstances where the decision was reached as a result of bad
faith, bias, dishonesty or breach of natural justice.
If you are not satisfied with the FOS Recommendation or
Determination, it is critical that you do not accept or reject it
before first seeking legal advice.
If you would like more information on these issues, please
contact Graham Roberts on +61 7 3231 2404, Clare McDonald on +61 7
3231 2475 or Taylor McCaw on +61 7 3231 2995.
Cooper Grace Ward is a leading Australian law firm based in
This publication is for information only and is not legal
advice. You should obtain advice that is specific to your
circumstances and not rely on this publication as legal advice. If
there are any issues you would like us to advise you on arising
from this publication, please contact Cooper Grace Ward
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