Financial Abuse And The Need For Better Financial Services Regulation

n December 2024 the Parliamentary Joint Committee on Corporations and Financial Services (the Committee) published a Report following an inquiry into how well the existing financial services regulatory framework is protecting against financial abuse. The Report highlighted a range of regulatory gaps and considered how financial institutions could better mitigate the risk of financial abuse.

Privacy

Inquiry submissions revealed that existing privacy laws prevent financial institutions from appropriately identifying, responding to and reporting financial abuse. Institutions are currently required to obtain explicit consent from customers before recording any sensitive information in their accounts. This prevents financial institutions from proactively documenting or flagging actual or suspected financial abuse thereby creating a barrier to the provision of appropriate support. It was therefore recommended that privacy legislation be revised to better allow