The GRC Professional reached out to Evelyne Albrecht from Albrecht Compliance Consulting addressed the ACCC inquiry into Homeloans and some questions around the potential implications for the wider industry. The Albrecht has previously spoken to the GRC professional about challenges around change fatigue.
From a general perspective, and in consideration of our earlier discussion, when it comes to reviews and investigations, I note the following:
There is a real risk in undertaking a review while changes from a previous review are still being implemented. Firstly, changes have yet to be made and the impact of the changes is not yet seen, so any subsequent review will likely not demonstrate any new findings where the reviews cover similar grounds.
Another concern is fatigue in the industry that may lead to unintended consequences at business levels. For example, we have seen the tightening in lending criteria because of a number of factors including the Royal Commission which had some detrimental effects on clients being able to access loans. Business may no longer be prepared to take any business risks or operate in a certain industry that is under constant review. In a way we have seen this with a number of banks exiting financial planning and I am not sure yet if this is a good outcome for clients.
One of the biggest concerns around reviews is where there is a recommendation to increase regulation. No matter how well this is done, it is likely going to have a cost impact and ultimately the client will likely be the one to have to pay the increased costs which of course could be detrimental.
While reviews can be helpful to determine impacts and evaluate if regulatory changes are needed, there should be some consideration of what has been done well but often the scope of a review deals with misconduct only. If the ACCC review considers both aspects, this could assist with the implementation of the regulatory change going forward.