By The ABA has today rejected suggestions from Mr Andrew Wilkie, Independent MP, who has claimed the Code of Banking Practice is a 'toothless tiger'. In a media statement1 , Mr Wilkie has called for a new Code and asked that the Australian Prudential Regulation Authority (APRA) be provided powers to fine, name and shame banks if they breach his proposed new code.
Steven Münchenberg, Chief Executive of the ABA, said: "The Code of Banking Practice is a contract between customers and subscribing banks which means courts can review compliance with the code."
"Banks' small business customers and individual customers have a number of avenues they can take a complaint if they believe that a bank has breached the Code of Banking Practice. They can go to the Financial Ombudsman Service (FOS), the Code Compliance Monitoring Committee (CCMC) and the Australian Securities and Investments Commission (ASIC).
"APRA is a prudential regulator and has no role in looking at these types of issues."
"As well, there are already numerous laws in place which protect bank customers. We need to be wary of just adding additional layers of regulation that make it more risky and expensive to lend to small businesses."
Mr Münchenberg said that bank customers can enforce their rights under the Code of Banking Practice.
"If a bank customer has a complaint, it is a good first step is to raise the issue with your bank. Your bank has an internal complaint handling service to assist you," he said.
"If your complaint is not resolved or the internal complaint handling service cannot resolve it, the FOS may be able to help."
"The FOS can be contacted toll free on 1300 78 08 08 or the website is www.fos.org.au. The FOS works with the bank customer and the bank to try and resolve the dispute. The FOS acts independently by not taking sides. It aims to get a fair outcome for both parties to a dispute."
"The FOS also provides an annual report which includes comprehensive Comparative Tables about the disputes performance of Australia's major financial services providers which includes banks. Consumers can find out how likely other consumers were to bring a dispute to FOS about a particular product from a particular financial service provider and what the outcomes of disputes involving particular providers were."
"The CCMC has been set up to investigate possible breaches of the Code, meaning that a possible breach can be referred to this committee."
For further information:
Heather Wellard, ABA PR,
T: 02 8298 0411
M: 0409 830 439
@austbanker
ENDS
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1"Taming the Banking Tigers". Tuesday, 21 August, 2012
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