Could Your Investment Give Rise to an AFCA Complaint?
Investors who have lost money through managed funds, investment trusts, unsecured notes, debentures or other securities may have grounds to complain to AFCA - even where no formal financial advice was provided. Recent AFCA determinations highlight that misleading information, undisclosed financial risks and the actions of representatives who facilitate investments may give rise to compensation claims. This article explores when an AFCA complaint may be available, what evidence can support a claim, and how investors can determine whether they may be entitled to recover their losses.
Could Your Investment Give Rise to an AFCA Complaint?
Investors who have lost money in managed funds, investment trusts, unsecured notes, debentures or other securities may have grounds to make a complaint to the Australian Financial Complaints Authority (AFCA).
Recent AFCA determinations concerning Remi Investment Services Pty Ltd demonstrate that a complaint may be available even where there is insufficient evidence that formal financial advice was provided.
Misleading conduct and undisclosed investment risks
In three published determinations issued in February and April 2026, AFCA considered investments made by family trusts and self-managed superannuation funds (SMSFs) in unsecured notes.
AFCA found that relevant entities knew, or ought to have known, that the issuers were likely insolvent when certain notes were issued or acquired. The issuers’ financial position was material information that should have been disclosed to investors. In some instances, the investment documents also contained warranties that no insolvency event existed.
AFCA concluded that failing to disclose the issuers’ likely insolvency, and communicating apparently false solvency warranties, amounted to misleading or deceptive conduct. Compensation awarded across the three determinations included:
- $114,436 plus interest;
- $675,000 plus interest; and
- $155,000 plus interest.
A representative may have “arranged” the investment
The determinations also highlight the conduct that may amount to arranging for a person to deal in a financial product.
A representative may have arranged an investment where, taken as a whole, they:
- introduced the investment opportunity;
- acted as the investor’s main contact or intermediary;
- supplied disclosure documents and application forms;
- completed or assisted with application forms;
- provided payment instructions; or
- monitored the transfer of investment funds.
This can constitute dealing in a financial product even if the representative did not recommend the investment or provide a Statement of Advice. Depending on the circumstances, an Australian financial services licensee may be responsible for the conduct of its authorised representative.
Could you have an AFCA complaint?
A potential complaint may arise where:
- material risks or financial difficulties were not disclosed;
- statements about solvency, safety, security, returns or risk were inaccurate;
- a financial firm or its representative facilitated the investment;
- the investment would not have been made if the true position had been disclosed; and
- the investor suffered loss as a result.
The available documents are critical. AFCA generally gives greater weight to contemporaneous evidence, including emails, presentations, term sheets, information memoranda, application forms, transaction records and notes of discussions.
How Financial Dispute Legal can help
Contact Financial Dispute Legal to discuss your circumstances and whether you have rights to recover compensation on 1300 433 533 or enquiry@fdlegal.com.au.
