Mulino’s lead generation clampdown in financial services a ‘bold move’ to protect Aussies’ savings
Consumer Action Law Centre CEO, Stephanie Tonkin says Assistant Treasurer Daniel Mulino’s announcement today to rein in bad actors profiting off Australians’ life savings, is a bold and welcome move by Government.
“Lead generation practices were central to the loss of $1 billion of ordinary Australians’ retirement savings to dodgy investment schemes in the devastating Shield and First Guardian collapses,” Ms Tonkin said. “Today’s announcement banning unlicensed customer contact, and limiting advice to licensed advisors with existing customer relationships only, will have a big and positive impact.”
Consumer Action has called for a total ban on dodgy lead generation practices in high-risk sectors, submitting Australia’s first designated complaint on the topic and publishing a report Manufactured Consent: Stopping the harm from manipulative lead generation.
“Where the risk of harm is high, we are calling for a full ban on these dodgy practices because criminals find a way around limited controls and in the digital age, bad actors, like water, find ways around piecemeal controls.
“There will be cases where the harm will continue,” she said.
While praising the reforms, Ms Tonkin said there was a missed opportunity to pull in digital platforms profiting from lead generators’ ads that are leading to financial ruin and harvesting our personal information for profit.
“More must be done, but today I thank Assistant Treasurer Mulino for his leadership on curbing lead generation,” she said.
Speaking to the National Press Club, Assistant Treasurer Mulino also announced reforms to the superannuation system aimed at preventing harm, increasing access to advice and ensuring the sustainability of the Compensation Scheme of Last Resort (CSLR).
“The entire financial services sector benefits immensely from the trust the CSLR brings to the industry and broadening out who contributes makes sense to ensure victims don’t pay for misconduct,” Ms Tonkin said.
“Yet we share our sector colleagues’ deep concerns about removal of the ‘But For’ test. This change will leave consumers bearing the cost of grossly inadequate controls and bad actors’ exploitation of their hard-earned retirement savings, where the financial services sector should do much more to prevent the harm or compensate.”
ENDS
Media contact: Mark Pearce media@consumeraction.org.au or 0413 299 567
