{"id":75398,"date":"2025-01-24T09:29:25","date_gmt":"2025-01-23T22:29:25","guid":{"rendered":"https:\/\/riskinfo.com.au\/news\/?p=75398"},"modified":"2025-01-31T13:06:56","modified_gmt":"2025-01-31T02:06:56","slug":"pressure-on-government-to-fix-cslr-before-election","status":"publish","type":"post","link":"https:\/\/riskinfo.com.au\/news\/2025\/01\/24\/pressure-on-government-to-fix-cslr-before-election\/","title":{"rendered":"Pressure on Government to Fix CSLR Before Election"},"content":{"rendered":"

The FAAA’s\u00a0Phil Anderson <\/strong>is continuing his criticism of the Compensation Scheme of Last Resort (CSLR) as the sector awaits the scheme\u2019s cost estimate and levy for the 2025\/26 year.<\/p>\n

In the FAAA’s submission to the Senate Economics Committee inquiry into wealth management companies, Anderson,<\/strong> GM Policy, Advocacy & Standards, highlights industry concerns about companies such as Dixon Advisory \u2013 which collapsed placing a financial burden on advisers.<\/p>\n

Its key bone of contention with CSLR is the cut off date for who pays when an historic complaint is covered by CSLR.<\/p>\n

In broad terms, the financial services sectors funding CSLR are responsible for claims for compensation submitted after 7 September 2022, despite the scheme not starting until April 2024.<\/p>\n

\"Phil<\/a>
Phil Anderson – calling for action to fix CSLR.<\/figcaption><\/figure>\n

Any complaints submitted, after the creation of AFCA in November 2018, up until 7 September 2022, are to be covered by the country\u2019s top 10 largest financial institutions.<\/p>\n

However, by September 2022 there had been 1,638 complaints to AFCA about Dixon Advisory \u2013 ASIC suspended the firm’s AFS licence in April 2022.<\/p>\n

Anderson wants to know why advisers across the country are collectively on the hook to compensate many of Dixon’s clients as it failed well before CSLR legislation became law in June 2023.<\/p>\n

\u201cThis is an important issue for the financial advice profession, with a potential exposure of up to $135m for just Dixon Advisory alone, and with more collapses continuing to emerge,\u201d states Anderson.<\/p>\n

Government has been aware of the problems with the CSLR for a long time now…<\/p><\/blockquote>\n

\u201cNow is a critical time as we await the expected announcement on the CSLR cost estimate and levy for the 2025\/26 year.<\/p>\n

“The Government is the key player in this. It is the one who designed and implemented the CSLR, and it is the only one that can fix the problems.\u201d<\/p>\n

The FAAA has previously set out three key complaints about the actions of Government:<\/p>\n