ASIC said the new guidance is an important step for the industry as it currently is monitoring 64 remediations that will see the return of about $5.4 billion to over 5.6 million consumers.
“Recent experience has shown that poor conduct has significant financial implications for companies, their investors, and ultimately their customers,” ASIC deputy chair Karen Chester said on Wednesday (17 November).
“This is demonstrated by the costly lag and drag of remediation and reputational damage.”
ASIC said its new guidance has expanded to cover financial services licensees, credit licensees and retirement service and will set out how remediations should be conducted efficiently and fairly.
Ms Chester added that licensees must do better at identifying and remediating problems earlier.
“One of the most common stumbling blocks we have seen across remediations is underinvestment in systems,” she said.
“This underinvestment has led to multiple failures. First and foremost, in delivering on promises to consumers, second in identifying the failures and third in being able to remediate consumer loss in a timely way.”
In December last year, ASIC revealed it was monitoring over 100 remediations that, when finalised, could see the return of at least $3.55 billion to over 3.6 million consumers.
Feedback on the new draft guidance can be submitted by 5pm on Friday, 11 February 2022.
