How FDRC Works

How FDRC works

The Financial Dispute Resolution Commission (FDRC) was established by experienced finance professionals and lawyers as the reserve scheme to provide greater accountability and transparency in the financial sector. The Financial Dispute Resolution Commission (FDRC) is the neutral, third-party Financial Dispute Resolution Centre that is dedicated specifically to financial institutions including forex brokerages, asset management firms, trust funds and payment services providers. The Financial Dispute Resolution Commission (FDRC) sets out to promote the most important values, namely trust, social responsibility and quality service.

The Financial Dispute Resolution Commission (FDRC) has an Advisory Council, which is appointed by the members and consumers, to monitor and advise the scheme. The Advisory Council is made up of five members: an independent chair, two industry representatives and two consumer representatives. Members of the Advisory Council are appointed for two years.

As part of FDRC’s commitment to international best practice for dispute resolution, it has an independent panel to call on when an expert opinion is required by the Scheme Adjudicator. Each of the panel members is carefully selected for their expertise in their respective field. To avoid any conflict of interest they must not be practicing, or otherwise declare any potential conflict – in which case they will stand aside on cases where a conflict may arise.

The Financial Dispute Resolution Commission (FDRC) also has in-house experts specialising in conflict management.

The Financial Dispute Resolution Commission (FDRC) provides a three-level complaint process, which aims to resolve disputes efficiently and thoroughly.

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Disputes can cover the services and advice that has been received from an Authorised Firm Member, but not the Authorised Firm Member’s general policies and practices or fees. For more information, visit What’s covered page.

Many disputes can be resolved in the initial stages of the dispute process, but those that can’t be resolved are escalated up through the three levels. If an agreement between the parties cannot be reached, The Financial Dispute Resolution Commission (FDRC) issues a formal decision. If a consumer agrees with the formal decision it becomes binding on the Scheme Member. Consumers who are still not happy with the outcome have the option of taking their dispute through other channels such as the Courts or the Disputes Tribunal.

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The dispute resolution process

Registration

The complaint is assessed for jurisdiction and deadlock. The complaint must have already been made to the Scheme Member, and the Scheme Member given an opportunity to resolve it. The complaint must also be about an event that happened after the date that the Scheme Member joined the scheme. A facilitator will liase with the parties to confirm that the complaint has reached deadlock. If so, full details of the complaint are requested so that The Financial Dispute Resolution Commission (FDRC) can establish jurisdiction. If found to be in jurisdiction then the complaint is accepted and enters into the dispute process.

Level 1

Information is gathered from all parties and exchanged. This may often result in resolution, once all the parties can see all of the information, and gain a better understanding of the others’ position. However, if there is no resolution at this stage the dispute moves to Level 2.

Level 2

At this level FDRC aims to help the parties reach an agreement themselves.

A mediator works with the parties to gather more information and to explore possibilities for resolution. The meetings are either face-to-face, via video or telephone conference or by email. If the parties can’t reach an agreement, The Financial Dispute Resolution Commission (FDRC) considers all of the information and recommends a settlement. If the parties don’t agree to the recommended settlement, the dispute moves to Level 3.

Level 3

This final stage of the process is conducted “on the papers”. All information and submissions provided by the parties are passed to an adjudicator. The Adjudicator issues a proposed final decision and invites comments. If the parties don’t agree with the proposed decision, a final decision is issued. If the final decision is accepted by the consumer, the decision becomes binding on the Scheme Member. If the consumer is not happy with the final decision, the complaint is closed. The consumer is still able to take the matter to other forums, such as the Courts or the Disputes Tribunal.

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