Responding to the financial abuse of older people - Loddon ...

7.6 BFSO scheme
(a) The BFSO scheme is a self-regulatory scheme, monitored by ASIC, and provides
an independent avenue of redress for bank customers who have complaints about
their banks. Membership of the BFSO scheme by banks is voluntary.
(b) Under the BFSO scheme’s Terms of Reference:
(i)
(ii)
the Banking and Financial Services Ombudsman (‘BFSO’) can consider
disputes which relate to any act or omission by a financial services provider
relating to the provision of financial services, including acts or omissions
relating to confidentiality, and, in the case of individual disputant, privacy
(clauses 2.1 and 3.1);
disputes are resolved having regard to law, applicable industry codes
or guidelines, good industry practice, and fairness (clause 7.1); and
(iii) a determination by the BFSO will be binding on a financial services provider
only if the disputant accepts the decision (clause 1.6).
(c) The BFSO recently released BFSO Bulletin 56, addressing the issue of abuse of the
vulnerable older person. The Bulletin noted the qualifications to the common
law duty of confidentiality articulated in Tournier’s case. 79 In particular, the Bulletin
noted the BFSO’s view that arguably it is in the bank’s interests to disclose
confidential information where fraud is a real possibility. The Bulletin also noted
that the Code contains an express acknowledgement 80 of a bank’s common law duty
of confidentiality and the qualifications in Tournier’s case. 81 In the BFSO’s view, it is
unclear whether a bank is entitled to the Tournier’s case exceptions if the information
is disclosed to a family member who is neither an Attorney nor an Administrator. 82
The BFSO also noted that a bank’s duty of confidentiality does not prevent it giving
customers information about relevant agencies or seeking direct consent of the
customer to notify third parties. 83
7.7 Conclusion
Banks have a common law duty of confidentiality to their customers (including elderly
customers) as outlined in Tournier’s case, which is qualified by four exceptions which
may be applicable in the context of reporting suspected abuse. Other laws and codes also
impose an obligation to protect a customer’s confidential information. The EFT Code
requires participating institutions to protect consumer privacy; the ASIC Act requires
financial institutions to promote the protection of consumer interests and the BFSO
scheme reinforces the common law position of protection of customer confidentiality.
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