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How ombudsman services can help you

We explain how ombudsman services operate and how the complaint process works.

woman helping another women with obudsman choice help
Last updated: 05 September 2014


Checked for accuracy by our qualified fact-checkers and verifiers. Find out more about fact-checking at CHOICE.

Ombudsmen are non-government intermediaries who can jump in on your behalf if you have a bona fide grievance with a goods or services provider that you can't resolve yourself.

They're funded by the industries they oversee, and their services are free for consumers. In effect, ombudsmen are paid to deal with consumer complaints that the service provider can't resolve to the customer's satisfaction.

The expectation is that an ombudsman can persuade the wrongdoer to do the right thing. But do they have any real leverage?

Limited powers

Some consumers have told CHOICE their dealings with ombudsman services have left them less than satisfied. In the case of the Telecommunications Industry Ombudsman (TIO), a conspiracy theorist might say that's because its board of directors is made up of former or current telco industry managers and executives.

Indeed, ombudsman services are set up as a kind of outsourced self-regulation. However, it's more likely that consumer frustration stems from having a poor understanding of what an ombudsman can and can't do. It's important to remember, for instance, that ombudsmen can't provide legal advice or represent you in court, and they can only deal with matters that fall within their terms of reference.

You'll also need to have tried to settle the issue before they become involved. More and more, though, merely threatening to contact an ombudsman is enough to spur service providers into fixing your problem.

Telcos and finance

The TIO and the Financial Ombudsman Service (FOS) look after two market sectors that generate many consumer complaints, but both services are making progress towards realising one of their central objectives – to persuade telcos and financial services providers to improve their own dispute resolution processes.

FOS payback

Most disputes with financial services providers are resolved between the customer and the relevant bank, credit provider, insurance company or other financial services provider, with the FOS refereeing from the sidelines. However, should the FOS step in and make an official recommendation or determination in your favour, it can require a financial service provider to:

  • pay you a sum of money
  • waive, vary the terms or release security for a debt
  • repay, waive or vary a fee including interest rates on a loan
  • vary the terms of a credit contract in cases of financial hardship
  • honour an insurance policy claim.

What the ombudsmen can and can't do

Financial Ombudsman Service  Telecommunications Industry Ombudsman

1300 78 08 08

1800 06 20 58

32,307 disputes received in 2012–13, down 11% from 2011–12

158,652 complaints in 2012–13, down about 18.1% from 2011

Funded by financial services providers (FSPs) who are FOS members. ASIC requires that all FSPs have an external dispute resolution process, although not all are FOS members.

Funded by telcos. All businesses that provide or re-sell telecommunications services to consumers or small businesses are legally required to join the TIO. Providers are charged by the TIO per complaint if it investigates.

Call them for disputes about:

  • credit cards or loans
  • insurance claims
  • banks, credit unions and building societies
  • financial planners/investment managers
  • EFTPOS, foreign currency transfers, loyalty programs, gift cards.

Call them for disputes about:

  • landlines
  • mobiles
  • internet services.

Don't call them about:

  • level of a fee, premium, charge or interest rate unless it's incorrectly applied or inadequately disclosed
  • methods used to assess credit risk or the amount of security required for a loan
  • how insurance premiums are determined or the premium amount
  • investment performance unless there is an issue of nondisclosure or misinformation
  • super fund management.

Don't call them about:

  • equipment supplied by a telco
  • cabling beyond the network termination point except to the first telephone
  • commercial activity by telcos outside of connection services
  • tariffs and rates
  • anti-competitive behaviour or restrictive practices that may breach the Competition and Consumer Act
  • content provided by a telco
  • matters that are or have been under consideration by ACMA, the ACCC or any court or tribunal.

Report card: 2012–13

  • 3062 of the 33,773 resolved disputes in 2012–13 (out of 32,307 received) required an FOS decision. Those remaining were worked out between the customer and provider.
  • Of those resolved by FOS, 1400 decisions were in favour of customers, while 1576 favoured the financial services provider (in 86 cases the FOS approved a financial service provider's offer to customers).

Report card: 2012–13

  • 177,047 of the 2012–13 complaints were resolved by mutual consent between the provider and customer after the TIO was contacted.
  • 15,928 required the TIO to conciliate a resolution.
  • 481 were considered for a binding decision or direction by the TIO.
  • 47,016 enquiries required the TIO to direct the customer to contact the telco in the first instance or the issue was outside the TIO's jurisdiction.
  • Mobile complaints accounted for about 58% of complaints received in 2012–13.

Dispute deadlines

  • A financial services provider has 45 days to resolve a dispute brought by a customer, or by the FOS on behalf of a customer, before the FOS will consider officially taking on a case.
  • For issues that fall under the National Credit Code, customers have two years from the end of the credit contract or the end of any internal dispute resolution process with the provider to complain to the FOS.
  • For other issues, consumers have six years from when they became aware of the issue, or two years from the end of any internal dispute resolution process with the provider.

Dispute deadlines

  • Customers have one year from the time they become aware of the issue to make a complaint, though the timeframe may be extended to two years in some cases.
  • The TIO will allow 10 working days for the telco to respond to the dispute before it becomes formally involved.


  • As a first step toward resolution, the FOS makes a recommendation that is binding if both parties agree to it within 30 days.
  • If the FSP doesn't agree but the customer does, the FOS can make a determination that is binding. If the customer doesn't agree, they can take the matter to court.


  • There are four complaint levels: at level three the TIO can make binding decisions for up to $1200.
  • For level four complaints made since July 2012, the TIO has the power to make binding decisions up to $50,000 and recommendations up to $100,000.
  • For level four complaints made before July 2012, the limits are $30,000 for binding decisions and $85,000 for recommendations.
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