How to Make a Complaint About a Financial Adviser

You have more options than you might think

If something has gone wrong with financial advice you've received - the recommendation turned out to be unsuitable, fees weren't disclosed properly, the adviser acted outside their authorisations, or you simply can't get a response to your concerns - you have a clear path to make a complaint. The process is more structured than most people realise, and in many cases it costs you nothing to pursue.

Start with the adviser or their firm

The first step in any complaint is to raise it directly with the adviser or the Australian Financial Services licensee they operate under. Licensed financial advice businesses are legally required to have an internal dispute resolution process, and they must respond to complaints in writing within a set timeframe - currently 30 days for most complaints, or 45 days for complaints about superannuation.

Put your complaint in writing, even if you've already raised it verbally. Set out clearly what happened, what advice was given, why you believe it was wrong or inappropriate, and what outcome you're seeking. Keep copies of everything - the Statement of Advice, any email correspondence, records of phone calls, and any product or account statements relevant to the complaint.

Many complaints are resolved at this stage. Firms have an incentive to resolve disputes internally rather than have them escalate, and a clearly written complaint that sets out the facts calmly and specifically is more likely to get a serious response than a general expression of dissatisfaction.

If the internal process doesn't resolve it - AFCA

If the firm rejects your complaint, offers a resolution you consider inadequate, or simply doesn't respond within the required timeframe, your next step is the Australian Financial Complaints Authority, known as AFCA.

AFCA is an independent external dispute resolution scheme that handles complaints about financial services, including financial advice. It's free to use as a consumer, and its decisions are binding on financial firms up to certain compensation limits. For financial advice complaints, AFCA can award compensation of up to $1,085,000 per complaint as of 2024 - a figure that covers the vast majority of individual advice disputes.

You can lodge a complaint with AFCA at afca.org.au or by calling 1800 931 678. You'll need to have already gone through the firm's internal complaints process first, or waited the required response period, before AFCA will accept your complaint.

AFCA will review the documentation from both sides, may request additional information, and will work through a conciliation process before making a determination if the parties can't reach agreement. The process can take several months for complex matters, but it is genuinely independent and has awarded significant compensation to consumers in financial advice disputes.

When to contact ASIC

AFCA handles compensation disputes - situations where you want to be made financially whole for losses caused by bad advice. ASIC handles regulatory matters - situations where you believe an adviser has broken the law, is operating without a licence, or poses a risk to other consumers.

If you believe an adviser is providing financial advice without holding a valid AFS licence, is engaging in fraud or dishonest conduct, or has behaved in a way that suggests other clients may be at risk, report it to ASIC at asic.gov.au/report-misconduct or by calling 1300 300 630. ASIC doesn't resolve individual disputes or award compensation, but it does investigate misconduct and has the power to suspend or cancel licences, impose conditions, and refer matters for criminal prosecution.

You can check whether an adviser is currently licensed on the ASIC Financial Advisers Register before or during a complaint. If their registration has been suspended or cancelled since you received advice from them, that's relevant information for both AFCA and ASIC.

Professional association complaints

If your adviser is a member of a professional association - the Financial Advice Association of Australia is the main one following the merger of the FPA and AFA - you can also raise a complaint with that body. Professional associations have their own codes of conduct and disciplinary processes, and a finding against an adviser through an association process can carry professional consequences beyond any financial compensation.

This route is less commonly used than AFCA and is probably best pursued alongside rather than instead of an AFCA complaint, particularly if you're seeking compensation.

What outcomes you can expect

The most common outcomes from a successful financial advice complaint are financial compensation for losses caused by the advice, a refund of fees paid, or a combination of both. In cases involving serious misconduct, ASIC action can result in an adviser losing their licence entirely.

It's worth being realistic about timeframes. Internal complaints can take a month or two. AFCA disputes involving significant amounts of money can take six months to a year or more. If you're considering legal action as an alternative or supplement to AFCA, get independent legal advice first - litigation is expensive and uncertain, and AFCA's process is generally more accessible for individual consumers.

Finding a properly licensed adviser to begin with

The best way to avoid a complaint situation is to verify an adviser's credentials before engaging them. All financial advisers authorised to provide personal advice in Australia must be registered on the ASIC Financial Advisers Register. You can search for a registered adviser near you on this directory, which is updated weekly from the ASIC register and includes each adviser's qualifications, authorisations and any disciplinary history on record.

Advisers with a disciplinary history aren't automatically unsuitable - the nature and age of the issue matters - but it's information you're entitled to have before you decide who to trust with your financial situation.