This fact sheet outlines how we consider possible systemic issues under our process and how we will work with you.

Contents

• Why are we contacting you?
• What do we need from you?
• Our process for dealing with a systemic issue
• What is the assessment process? 
• Want more information?

AFCA has a statutory responsibility to identify, refer and report systemic issues to regulators, such as ASIC, arising from the consideration of any AFCA complaint.

AFCA must also report any serious contraventions of the law and other reportable matters listed in the Corporations Act. AFCA’s reporting obligations are set out in ASIC Regulatory Guide 267, the Corporations Act 2001 (Cth) and the AFCA Rules. 

The primary purpose of AFCA’s reporting obligations is to ensure that regulators have the information they need to take regulatory action as they see necessary. 

Why are we contacting you?

During an AFCA complaint, our complaint handlers sometimes identify conduct or errors which they believe may represent a systemic issue. The complaint handler will refer this issue to the Systemic Issues team for review. 

If the Systemic Issues team considers that the issue may be systemic, we will contact you to gather information to make an informed decision about whether the matter is, in fact, a systemic issue.  

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What do we need from you?

As part of our process, we will first contact you by telephone to discuss the issue. We will then send out a letter outlining the details of the issue and asking for further information within a set timeframe.

We encourage you to engage with AFCA during the systemic issues investigation. In some cases, our concerns can be satisfied in the early stages of an investigation.

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Our process for dealing with a systemic issue

1. Identify
   We identify a possible systemic issue from our consideration of an AFCA complaint.
2. Refer
   We refer the possible systemic issue to you so you can provide us with further information and evidence about the issue.
3. Form a view
   After reviewing your response, we will form our view and let you know the outcome in writing. An AFCA decision maker is usually involved in making this decision. 
4. Report
   If the issue is a systemic issue, we report it to the regulator as we are required to do under RG267 and s1052E, Corporations Act.

We can share information with regulators under our AFCA Rules, if required, at any stage of our process. 

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What is the assessment process?

When we assess systemic issues, we take into account:

• the information available to us on any relevant AFCA complaint
• the information and evidence provided by you, including any additional comments
• obligations under relevant laws, regulations and industry standards
• consumer impact.

An issue will be considered systemic in nature if, after reviewing the information provided by you, we form a view that the error or conduct:

• is an issue that is likely to have an effect on consumers beyond the individual complaint
• has had a detrimental effect on consumers or could pose a future risk of harm to consumers
• is a breach of a statutory or regulatory obligation or good industry practice.

If we form the view that the issue is systemic, we are required to report the matter to regulators, including ASIC within 15 days of forming this view.

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