What’s new with the Mutual Banking Code of Practice Code Compliance Committee?

The Mutual Banking Code of Practice sets out standards of good practice for credit unions and mutual building societies. The Code Compliance Committee (CCC) has a new  Executive Manager, and is conducting a number of reviews. This update also sets out current governance and investigation arrangements and provides information about this years’ annual compliance statements.

Reviews

The CCC is currently conducting a number of reviews on specific Code issues, including Code training, compliance with provisions for guarantees and a follow up review regarding the improvement of Mutuals’ websites since the CCC’s review in May last year.

The objectives of the reviews are to develop a better understanding on how Mutuals manage and maintain adequate Code compliance and Code training for staff.

Changes at the CCC

Following Damian Paull’s departure to take up the role of Chief Executive Officer of the Australian Retail Credit Association (ARCA), I am pleased to let CFA supporters know that Dr June Smith has been recruited as the CCC’s new Executive Manager. June has been a Principal in Argyle Lawyers Pty Ltd in its Melbourne office and consulted to the financial services industry on issues relating to governance, professional ethics, corporations law, compliance and alternative dispute resolution.

June has a PhD in Law from Victoria University, Melbourne. Her thesis examined the factors influencing ethical decision making within financial services organisations.   June has significant expertise in the development and implementation of professional and ethical frameworks and commenced in the Executive Manager role in July.

Governance arrangements

The Code Compliance Committee (CCC) appointed by the Mutual Banking Code Compliance Association (MBCCCA) is responsible for monitoring the Mutual Banking Code of Practice (Code). The CCC in turn has appointed the Financial Ombudsman Service (FOS) as Compliance Manager to carry out its compliance functions. There is a dedicated team within FOS that is responsible for dealing with Code compliance for credit unions and mutual building societies (Mutuals) who subscribe to the Code. FOS also monitors the Banking Code of Practice, the Insurance Brokers’ Code of Practice and the General Insurance Code of Practice.

Annual Compliance Statements

Each year, Code subscribers are asked to complete a compliance statement (ACS). The ACS is a self-assessment tool to review the organisation’s compliance with the Code.  The content of the document is developed in consultation with a number of Mutuals and the CCC and will assist each  Mutual in assessing the effectiveness of its Code compliance program.

The ACS responses will also provide the CCC with a clear picture of the extent to which Code subscribing Mutuals are implementing their obligations under the Code.
This year’s ACS was recently circulated to the member Mutuals, and completed statements will be reviewed and analysed over the coming months, including through verification visits. This year’s ACS has a particular focus on compliance with Code obligations for guarantees, the visibility of the Code and access to it on the websites of Mutuals, internal dispute resolution (IDR) and external dispute resolution (EDR) information, cancellation of direct debits and incorporation of the Code into existing terms and conditions.

Investigations

In addition to the ACS, the CCC investigates specific allegations of Code breaches that are made by consumers, consumer representatives and others.  Allegations of Code breaches can be made electronically at the [ilink url=”http://www.cccmutuals.org.au/”]CCCMutuals website[/ilink] or by contacting the CCC secretariat on 1300 780 808.

Remember, however, that the CCC investigates allegations of Code breaches, and does not have the power to award compensation.

by Professor Gail Pearson
CCC, Consumer representative

Further information: [ilink url=”http://www.cccmutuals.org.au/about-ccc/the-code/”]Mutual Banking Code of Practice[/ilink]

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