Financial misconduct

In a long-awaited development, the Senate has approved a bill to create the Compensation Scheme of Last Resort (CSLR), ensuring that individuals affected by financial misconduct can seek redress and compensation. This marks the implementation of one of the final recommendations made by the Hayne Royal Commission.

This achievement is particularly significant for more than 2,000 individuals who have been eagerly awaiting a resolution in their respective cases.

Under the CSLR, consumers with unpaid determinations from the Australian Financial Complaints Authority in relation to personal financial advice, credit intermediation, securities dealing, and/or credit provision will be eligible for compensation of up to $150,000.

To expedite the commencement of the CSLR, the government will cover the costs associated with establishing the governing body responsible for its operation, including funding the initial levy period until the conclusion of the 2023-24 fiscal year. Subsequently, the industry will be responsible for funding the scheme in the following years.

Starting from April 2024, individuals will be able to submit claims for compensation, and the first payments are expected to be disbursed shortly thereafter. 

Brisbane – Clive Todd

Melbourne – Michael Jones

Sydney – Jeremy Mortlock

+61 7 3218 3900

+61 3 9252 0800

+61 2 9922 1166

 

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Published: 03/07/2023

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