The Government is delivering on its election commitment to give victims of financial services misconduct access to redress and compensation.
From 2 April 2024, consumers will be able to lodge claims for compensation under the Compensation Scheme of Last Resort (CSLR) with payments to follow for eligible consumers.
The scheme will be operated by Compensation Scheme of Last Resort Limited (CSLR Limited), and the Albanese Government has appointed Ms Jo‑Anne Bloch as the inaugural independent Chair of the Board of CSLR Limited for an initial term of three years.
Ms Bloch is an experienced leader in financial services, and in particular financial advice, with extensive experience in engaging government and in the not‑for‑profit sector, and is well‑equipped to guide the scheme at its inception and beyond. The Government congratulates Ms Bloch on her appointment to the Board of CSLR Limited.
The CSLR will provide compensation of up to $150,000 to eligible consumers who have an unpaid determination from the Australian Financial Complaints Authority (AFCA) relating to the provision of personal financial advice, credit intermediation, securities dealing and credit provision.
The CSLR is intended to provide compensation where the misconduct is by a financial services firm that was licensed to provide the relevant product or service. The Government will ensure this intent is met through amendments to the CSLR legislation in due course to provide further certainty to consumers about the scope of the CSLR.
As an interim step, amendments have been made to AFCA's authorisation so that, to the extent possible, complaints that may be eligible under the CSLR are progressed only if the financial services firm was licensed to provide the relevant product or service.
Consequential changes to AFCA's Rules will be required to implement the amendment to AFCA's authorisation.
By announcing a starting date and appointing the Chair of the Board of CSLR Limited, the Government is demonstrating its ongoing commitment to ensuring victims of financial services misconduct have access to redress and compensation.
