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Brokers will have an extra week to appeal their pre-expulsion notice or resolve their accounts before formal action is taken, it has been confirmed.
Last week, many brokers reported receiving pre-expulsion notice emails from the chief ombudsman and chief executive of the Australian Financial Complaints Authority (AFCA), David Locke, warning them that they may be expelled from the body due to “unpaid invoices”.
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Several brokers contacted The Adviser following receipt of these emails to highlight that they had already paid these invoices and received renewed AFCA membership certificates, voicing concern as to the impacts that this notice would have on their credit licences. Indeed, the Australian Securities and Investments Commission (ASIC) confirmed to The Adviser that AFCA membership is a requirement for credit licensees and credit representatives under the NCCP – and anyone breaching that would be reported to ASIC, which would “consider whether it is appropriate to take any further action in the circumstances of the licensee or credit representative that is affected.”
While the email from Mr Locke initially told brokers that they had seven days to provide evidence to appeal the expulsion or rectify their unpaid invoices before AFCA’s board of directors meeting on Thursday (11 November), several industry heads had been engaging with AFCA to resolve the issue.
The CEO of the Mortgage and Finance Association of Australia (MFAA), Mike Felton, has now revealed that “following extensive engagement” between the MFAA and AFCA over the past week, AFCA has now confirmed to the association that the deadline for pre-expulsion notices has been extended.
In an update to members, Mr Felton wrote: “We are pleased to advise AFCA has notified the MFAA that it is extending the deadline for pre-expulsion notices by one week.
“Affected members now have until 5pm on Thursday, 18 November 2021 to resolve their accounts before any formal expulsion action is taken.”
The MFAA said it was encouraging all affected members to ensure that by the new deadline of 18 November all outstanding invoices referred to in the pre-expulsion notice have been paid and that any evidence demonstrating payment has been sent to the AFCA accounts team.
“We also encourage all members to take the opportunity to ensure that their contact details with AFCA are current,” the association suggested.
MFAA members who continue to experience issues after Thursday (18 November 2021) are being urged to contact the MFAA’s compliance team.
Any brokers experiencing hardship or are unable to meet the time frame, are also being urged to contact AFCA on
A spokesperson for AFCA confirmed to The Adviser the new deadline, commenting: "The deadline for payment was extended to 5pm, 18 November 2021 to give Authorised Credit Representatives (ACRs) AFCA members time to pay or resolve issues related to their AFCA membership renewal."
[Related: Deadline for AFCA expulsion appeals looms]
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