In a joint Annual Report, the Ombudsman for Long-term Insurance (Olti) and the Ombudsman for Short-term Insurance (Osti), which has as its theme “Shaping our Tomorrow”, said this week that the highlight of the 2022 financial year was Finance Minister Enoch Godongwana’s recognition of the Ombud Council under the Financial Sector Regulation Act.
The minister appointed Leanne Jackson as the chief ombud of the council, for five years, late last year.
Jackson was an independent consultant in financial sector regulation at the time but worked in various positions at the Financial Sector Conduct Authority (FSCA) for more than a decade. She advised on market conduct and headed the strategy of treating customers fairly, at the regulator and its predecessor, the Financial Services Board (FSB).
According to the annual report, the newish Ombud Council has the mandate to oversee financial ombud schemes and assist in ensuring that they provide customers with access to affordable, effective, independent and fair alternative dispute resolution processes for financial complaints.
Much progress was also made during the year, towards the amalgamation of the four voluntary industry ombud schemes, including Olti, Osti, the Ombudsman for Banking Services and the Credit Ombud.
Denise Gabriels, the Olti deputy ombudsman, said meetings between members of the four ombudsman schemes had the benefit of fostering working relationships among the offices and a better understanding of one another’s operations and challenges. The amalgamation plans had been presented to the four respective offices' boards and had subsequently been approved. The new combined non-statutory body would come into force on January 1, 2024 and would be known as the Financial Services Ombudsman, subject to approval.
The two remaining bodies, over which the Ombud Council has oversight powers, are the Pension Funds Adjudicator, as defined in the Pension Funds Act, and the Ombud for Financial Services Providers, as defined in the Financial Advisory and Intermediary Services (FAIS) Act.
Both the offices are defined by a specific financial sector law to be the statutory body. Their findings are legally binding in a court of law, unlike the other four-to-be-one offices which can examine only complaints and address the public bodies concerned in the matter by making appropriate recommendations, but which are not legally enforceable.
Also, institutions that prescribe the ombuds’ mandates, do so voluntarily.
Not all banks, credit providers or insurers who operate in SA will necessarily, participate in the dispute resolution methods.
But more interestingly, the Ombud Council’s plan is to introduce a fourth player into the financial fray.
It recently published an Invitation on its website for submissions on draft amendments to the governing rules of the JSE Ombud Scheme, with the set of draft rules attached to the announcement.
“Written submissions on the proposed rule amendments must be sent to the Ombud Council via email to admin@ombudcouncil.org.za by no later than 17:00 on 05 June 2023,” it stated.
That being said, the JSE Scheme was issued a certificate of recognition in May last year, as the documents now indicate, but the information was not in the public domain when Personal Finance picked up on the JSE’s Inclusion on the list of schemes the new chief ombud would be overseeing on its website, shortly after Jackson’s appointment.
The JSE communications officer, whose name appears there as the contact person, had no idea what we were talking about when we enquired about the JSE honourable mention. The council’s media team did not respond to our queries. At least now there is a bit more clarity on that.
The draft amendment to the governing rules of the JSE Ombud Scheme, however states: “The JSE published a Market Notice 064A/2023 on 15 February 2022, inviting comment from the JSE members concerned on proposed amendments to give effect to the Ombud Council Recognition Conditions, for a ten-day consultation period. No objections to the proposed amendments were received and the JSE proceeded to submit the proposed amendments to the Financial Sector Conduct Authority (FSCA) for approval.”
To be honest, I can‘t find that market notice on the JSE’s website.
I made screen shots of my search just in case they disagree with me when I follow up on this matter with them again.
The same goes for the chief counsel.
The announcement also stated: “The FSCA published the draft amendments on its website for comment on 11 April 2023 for a fourteen-day comment period, in accordance with section 71(3)(b)(ii) of the Financial Markets Act, as indicated in FSCA Board Notice 429 of 2023 published in Government Gazette no. 48402 of 6 April 2023. The FSCA confirmed to the Ombud Council on 25 April 2023 that the comment period is closed, with no comments or objections having been received.”
They did, however, fail to inform me of the developments after I reached out to them on the JSE matter last year as well.
I have a lot of questions and hope to get some answers soon.
PERSONAL FINANCE