AMA: I'm Phil Anderson, GM Policy, Advocacy & Standards at FAAA, Ask Me Anything!

Thanks ShwetaM1. Most of the complaints related to financial advice go through the Internal Dispute Resolution (IDR) process and the External Dispute Resolution (EDR) process that is managed by AFCA. The AFCA rules do have time limitations, including that the complaint must be submitted “within six years of the date when the Complainant first became aware (or should reasonably have become aware) that they suffered the loss”. There is also a further time limit that is applied – “where prior to submitting the complaint to AFCA, the Complainant was given an IDR Response in relation to the complaint from the Financial Firm - within two years of the date of that IDR Response”. These limitations are sensible and do protect advisers from facing very old complaints.

It is however important to note that it relates to when the client became aware that the loss occurred.  It is possible that deficiencies in advice could result in losses arising some years later, so this is not the same as saying that there is a limitation of liability of six years from when the advice is provided.