EDR review a coincidence, claims ASIC

by Adam Smith14 Dec 2011

ASIC has denied its EDR review is a result of industry lobbying, and has poured water on claims it is set to bow to pressure to change its regulations on the schemes.

Matthew Bransgrove, a lawyer specialising in the mortgage market, has submitted a white paper questioning the authority given to EDR schemes such as COSL and FOS.

Following the submission of the paper, ASIC launched a review of its regulatory guide on EDRs, but an ASIC representative has told Australian BrokerNews the timing is coincidental.

"The consultation paper fulfils a commitment ASIC undertook when it approved the Financial Ombudsman Service Ltd's terms of reference in December 2009 to review the existing requirements in RG 139," the spokesperson said.

The ASIC representative said the review was set down in RG 139. She also dowsed claims by Bransgrove that ASIC was set to bow to pressure to change EDR authority.

"Our starting point is that the requirement in RG 139.77-RG 139.79 is appropriate, and does not require change," she said.

The regulator will, however, seek feedback on the requirements and whether any refinements should be made.

"In considering whether refinements should be made, we will have regard to maintaining an efficient and effective EDR system and promoting the participation of confident and informed consumers," the ASIC spokesperson said.

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ASIC vows EDR review

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COMMENTS

  • by Stephen Dinte 14/12/2011 12:38:22 PM

    It is vital to have people like Matthew Bransgrove looking at all of the legal aspects of this legislation. Full marks to that firm for taking the time to produce that white paper on this issue. Heaven help us if FOS & COSL were given power that rightly belongs in the sole domain of our legal system.