Australia’s financial regulatory authority reported an unprecedented surge in complaints last year, spurred by the repercussions of significant investment firm failures impacting the industry.

In 2015, more than 111,000 complaints were filed by Australians across various sectors, including banking, insurance, financial advice, superannuation funds, and financial advisors. This marked a notable 14% increase from the previous year, as detailed in a statement released on Thursday.

The Australian Financial Complaints Authority (AFCA) noted that this was the highest volume of complaints it had ever recorded within a single year.

Individuals and small businesses who sought resolutions through AFCA received a total of $643 million in compensation and refunds. This sum represents a remarkable 120% increase over the preceding year, setting another unprecedented record.

Advisers, self-managed super in AFCA’s sights

The statement highlighted a nearly 60% rise in grievances concerning self-managed superannuation funds, largely attributed to a series of significant collapses in the financial advisory and superannuation sectors.

This increase included over 2,100 complaints related to the downfall of the Shield and First Guardian Master Funds, which adversely affected thousands of Australians who had invested their retirement savings in these companies.

Many Australians were convinced by financial advisers to place their retirement savings into the funds, which are now both under administration and subject to multiple court proceedings.

Last year, SBS’ The Feed spoke to Melburnian Susy Zjak, whose superannuation balance dropped by more than $500,000 overnight after her First Guardian Master Fund entered liquidation.

“I felt like a knife hit my heart,” she told The Feed of the moment she read the email telling her that her retirement savings may not be recoverable.

“I felt dizzy. I just cried. I vomited. I actually thought I was going to have a heart attack. It was the worst nightmare of my life.

“This is 30 years of working, 30 years of hard working.”

AFCA chief ombudsman and chief executive David Locke said Shield and First Guardian Master Funds-related complaints would continue to be a “key focus” in 2026, with more than 500 simultaneous investigations still underway.

“We have now issued 44 decisions, including five lead decisions, and have 500 simultaneous investigations underway, and we remain firmly committed to progressing these matters as quickly as we can,” Locke said.

We have now issued 44 decisions, including five lead decisions, and have 500 simultaneous investigations underway, and we remain firmly committed to progressing these matters as quickly as we can,” said Chief Ombudsman and Chief Executive Officer David Locke.

AFCA also issued its 1,000th determination relating to Dixon Advisory — the “largest single batch of complaints” it has ever handled — with around 900 matters still under investigation.

“We know that large-scale financial firm collapses can have a profound impact on people and their families. We’re working through these matters as quickly and carefully as we can, and we’re making steady progress,” Locke said.

What’s driving the spike in complaints?

Superannuation complaints rose 29 per cent to 7,687, driven largely by delays in handling claims and disputes over claim decisions.

While complaints about death benefits remained steady, the main pressure points were timeliness and transparency in the claims process.

Overall, delays in claim handling were the single most complained-about issue, with 9,274 complaints lodged.

Complaints about misleading products or service information more than doubled, rising 110 per cent.

Personal transaction accounts were the most complained-about financial product (15,315 complaints), followed by motor vehicle insurance (12,879), credit cards (11,316), home building insurance (7,359) and consumer credit insurance (7,137) — up 88 per cent.

Since it began operating in late 2018, AFCA has received more than 634,000 complaints and secured $2.1 billion in compensation.

Locke said the latest figures came at an important moment for the financial services sector and AFCA, and showed the “sustained demand for our service”.

“With a new banking code in force, and major reforms underway across general and life insurance, this is a pivotal moment for the financial services sector to lift standards and deliver more consistent, accessible and customer-focused outcomes for their customers,” he said

— With additional reporting by The Feed, Gabrielle Katanasho and Zacharias Szumer.

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