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Cash Distribution Regulation Australia

David Jacobson — Tue, 25 Aug 2026 06:32:48 +0000

The Cash Distribution Framework Bill 2026 has been passed by both Houses of Parliament and is awaiting Royal Assent.

UPDATE: The Act received Royal Assent on 26 August 2026.

The bill establishes a framework to regulate cash distribution services in Australia, including an oversight framework for service agreements and access agreements and powers for the Australian Competition and Consumer Commission to set service-level standards.

It focuses primarily on the cash-in-transit sector, which has become concentrated around one dominant provider.

Cash distribution services include cash access facilities, cash storage and processing, cash transport and cash access support.

The main elements of the Bill include:
* the Reserve Bank of Australia can designate an entity that has a significant role in the cash distribution system. The designated entity is then subject to the regulatory framework.
* the ACCC can oversee pricing and other terms in agreements covering critical cash distribution services and access to facilities, and to set service-level standards to support access to cash.
* the Reserve Bank crisis readiness and resolution powers enable the RBA to step in if a designated provider becomes financially unviable, helping to ensure cash distribution does not stop.

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Author: David Jacobson
Principal, Bright Corporate Law
Email: djacobson@brightlaw.com.au
About David Jacobson
The information contained in this article is not legal advice. It is not to be relied upon as a full statement of the law. You should seek professional advice for your specific needs and circumstances before acting or relying on any of the content.

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Case note: monitoring financial service promises

David Jacobson — Tue, 25 Aug 2026 06:32:14 +0000

In In the matter of Fiducian Investment Management Services Pty Ltd [2026] NSWSC 959 the Supreme Court of NSW declared that Fiducian Investment Management Services Limited (FIMS), contravened section 12DF of the Australian Securities and Investments Commission Act (ASIC Act) and section 601FC(1)(b) of the Corporations Act 2001 (Cth), by making false or misleading statements in relation to investments in the Diversified Social Aspirations Fund (DSA Fund) and by failing to monitor its investment managers.

Penalties totalling $7.3m were imposed on Fiducian.

FIMS is the holder of Australian Financial Services Licence and the Responsible Entity for a suite of registered managed investment schemes.

The DSA Fund was operated and managed by FIMS using the “Manage-the-Manager” investment system.

Each of the underlying investments of the DSA Fund had specified “investment screens”, being a set of investment rules or filters applied by the underlying manager to determine which companies or shares were aligned with the specific environmental, social and governance (ESG) standards or objectives of that fund.

The underlying investments did not exclude investments in shares or companies that derived revenue wholly or substantially from fossil fuels.

Each version of the DSA Fund PDS stated “Fiducian constantly monitors the Fund’s underlying investment managers to ensure that they maintain their investment styles and processes”.

FIMS admitted that by making statements about the DSA Fund’s ESG investments, and by failing to withdraw or qualify those statements, FIMS represented that, amongst other things, the DSA Fund would only make investments, amongst other things, in companies that were considered to be positive for society and the environment.

FIMS also admitted it represented that the portfolio exposure of the DSA Fund (including exposure through any underlying investments) would be monitored to ensure that such exposure was in accordance with the ESG Statements; and the investment managers making investments on behalf of the DSA Fund (including through the underlying investments) would be constantly monitored to ensure that they maintained their investment styles and processes.

FIMS accepted that it did not provide any specific training to staff in relation to ESG or ethical investing.

The trial judge said that penalty of $5 million in relation to the contravention of s 601FC(1)(b) of the Corporations Act, and a penalty of $2.3 million in relation to the contraventions of s 12DF(1) of the ASIC Act, was appropriate, as it took into account the extent of FIMS’s failures over a period of several years, and in particular its failure to discharge its duties to act with care and diligence, and also took into account FIMS’s contrition and co-operation, as well as the steps which it has taken to improve its systems and processes.u

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AFCA publishes new Approach papers

David Jacobson — Tue, 25 Aug 2026 06:31:45 +0000

The Australian Financial Complaints Authority (AFCA) has published two new Approach papers for insurance complaints and updated another one, setting out how it assesses compensation for non-financial loss.

AFCA’s Approach to general insurance claims handling provides practical insight into how AFCA assesses claims handling obligations and remedies in general insurance complaints.

Claims handling is the most complained about issue in general insurance complaints at AFCA.

AFCA’s Approach to uninsured motorist complaints clarifies AFCA’s jurisdiction and how liability is assessed in uninsured motorist complaints.

AFCA has also updated its Approach to non-financial loss.

It includes a table that sets out how AFCA assesses the severity and duration of harm when considering compensation for non-financial loss.

It contains case studies covering scams, financial hardship, insurance, privacy, and family violence complaints.

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Uncontactable members

David Jacobson — Tue, 25 Aug 2026 06:31:12 +0000

ASIC Corporations (Amendment and Repeal) Instrument 2026/675 has repealed ASIC Corporations (Uncontactable Members) Instrument 2016/187 as the relief contained in that instrument is no longer required, given changes to the Corporations Act 2001 introduced by the Treasury Laws Amendment (Modernising Business Communications and Other Measures) Act 2023.

Under section 110JA of the Corporations Act, relief is now provided from the requirement to send certain documents, including annual reports, if a member is uncontactable.

In section 110F(4A), situations where there is no current address for sending documents in an elected manner are addressed.

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Sustainability reporting changes

David Jacobson — Tue, 25 Aug 2026 06:30:39 +0000

The Australian Government is consulting on changes to improve the efficiency of climate-related financial disclosures (“sustainability reporting”).

Reforms announced in the Budget 2026-27 include raising the monetary thresholds prescribed for determining whether a proprietary company is ‘large’:
to $100 million revenue (from $50 million); and
to $50 million in assets (from $25 million).

This will have the effect of relieving smaller Group 3 entities (between the current thresholds and the proposed increase) from mandatory sustainability reporting.

The main proposals include:
* changing assurance rules to reduce compliance costs;
* providing clearer guidance on key terms and concepts; and
* reducing the burden of information requests across supply chains.

The changes being considered will not impact those reporting for the 2026-27 financial year.

ASIC has released a series of sustainability reporting videos, completing the package of educational materials to help companies understand foundational concepts behind the sustainability reporting requirements.

Mandatory climate-related financial disclosures commenced on 1 January 2025, requiring Australia’s largest entities to report on their climate-related risks and opportunities.

The legislation requires Australia’s largest listed and unlisted reporting entities to prepare an annual sustainability report in accordance with Chapter 2M of the Corporations Act 2001.

Reporting entities are being phased into reporting requirements in three groups.

Table 2 in ASIC RG 280 sets out the phasing in of reporting requirements.

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Superannuation consumer protection changes announced

David Jacobson — Thu, 20 Aug 2026 06:57:34 +0000

The Government has announced changes to strengthen consumer protections in the Australian superannuation, advice and investment system.

The changes will affect APRA-Regulated Superannuation funds as well as self-managed super funds, Managed Investment Schemes and financial advisers.

They will also include:
* Empowering the ATO to prevent rollovers to new SMSFs in situations where the ATO is investigating concerns of fraud, financial abuse, misconduct or potential harm.
* Introducing mandatory trustee education prior to SMSF registration, and requiring SMSFs to have a written investment strategy upfront.
* Banning unlicensed real-time communication with consumers about superannuation (lead generation), with targeted exemptions to protect advocacy, educational and employment communications.
* Giving the Auditing and Assurance Standards Board (soon to become External Reporting Australia) the power to make mandatory audit and assurance standards for auditors of Managed Investment Schemes compliance plans.
* Simplifying the Best Interests Duty reform of financial advice, by maintaining the existing obligation and safe harbour steps, and removing only the broadest safe-harbour step that is a barrier to scaled advice.
* Limiting Compensation Scheme of Last Resort payments to actual losses for applications made to AFCA after 30 June 2027, without any change to AFCA entitlements.
* All SMSFs will be included as CSLR Tier 3 levy payers in the waterfall model in future years when a special levy is required.

For APRA-Regulated Superannuation Funds, the changes include:
1 Legislation will impose an obligation on trustees to set and ensure compliance with caps on advice fee deductions from member accounts.
2. The Superannuation Industry (Supervision) Act will be amended to increase maximum civil penalties to 50,000 (up from 2,400 units) penalty units for core breaches of trustee obligations. A penalty unit is currently equivalent to $364.
3. Providing APRA with the power to set risk-based capital requirements for superannuation trustees offering higher-risk investment options to their members.
4. Providing ASIC with the power to direct superannuation trustees to commence a remediation process when an investment option fails and there is reason to suspect a failure of trustee obligations.
5. Introducing the New Class of Adviser regime to APRA-regulated superannuation and life insurance entities, supported by safeguards against vertical integration through prohibitions on commissions, bonuses and volume-based payments that are features of sales-driven advice models. This measure will be subject to a review three years after commencement to evaluate the scope and operation of the reform.

APRA’s powers
APRA has announced it would set capital requirements for trustees offering higher risk investment options. These requirements would seek to ensure trustees have the financial capacity to meet their obligations under the proposed compensation scheme.

APRA will consult on a package of reforms to lift investment governance standards and reduce the likelihood of member harm.

The proposals would strengthen requirements across eight areas covering the full investment management lifecycle.

The main proposals include:
• Ensuring that a trustee’s investment management capability is commensurate to the complexity of their investment menu;
• Addressing weaknesses in onboarding, monitoring and offboarding practices;
• Addressing material conflicts;
• Improving member-level diversification; and
• Strengthening trustee oversight and accountability.

The investment governance reforms would apply to all trustees.

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Unfair trading practices ban passed by Parliament

David Jacobson — Thu, 20 Aug 2026 06:56:36 +0000

The Australian Parliament has passed the Competition and Consumer Amendment (Unfair Trading Practices) Act 2026 (Cth), to amend the Australian Consumer Law by banning unfair trading practices and subscription traps from 1 July 2027.

Unfair trading practices capture conduct in connection with the supply of, or an offer to supply, goods or services that manipulates the consumer and causes, or is likely to cause, detriment (whether financial or otherwise) to the consumer.

The changes strengthen protections against ‘drip pricing’ by requiring a person offering goods or services at a base price to disclose information relating to any applicable transaction-based charge that would apply to the supply of those goods or services.

The changes also require a person offering goods or services under a subscription contract to provide subscribers with certain pre-contract and ongoing information and an easy and straightforward way to end a subscription, including an online cancellation option in certain circumstances.

The reforms will not apply to the financial services sector for the time being, but the Government says it is working with the states and territories and the Australian Securities and Investments Commission to explore further alignment of protections within the financial services sector.

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Case notes: AML/CTF debanking

David Jacobson — Thu, 20 Aug 2026 06:55:28 +0000

Two recent cases have considered when financial institutions have declined, withdrawn or limited banking services to customers in certain industry sectors due to factors such as commercial considerations, reputational risk and regulatory risk exposure (“debanking”).

Although Austrac has issued guidance to reassure banks that there is no requirement in the AML/CTF Act or Rules to decline to provide designated services to whole industry sectors, notwithstanding a financial institution’s assessment of the industry sector’s relative risk, the courts have upheld debanking decisions which comply with customer contracts and banks’ risk appetites.

In Merciful Group Inc v Norfina Ltd t/as Suncorp Bank [2026] NSWCA 155 the NSW Court of Appeal dismissed an appeal from the NSW Supreme Court decision upholding a bank’s closure of a customer’s account following concerns raised through its AML/CTF risk assessments that the account was involved in money-laundering or terrorism financing activities.

Merciful is an Australian registered charity which provides aid to conflict-affected countries including Syria, Lebanon and Yemen. Suncorp’s internal systems had identified Merciful’s account as being of high AML/CTF risk.

Suncorp advised that Merciful’s account would be closed in accordance with cl 15.2 of the terms applicable to the account.

Clause 15.2 provided: “We [Suncorp] can close your Account immediately if… (c) to protect our legitimate interests; (d) we need to by law or to meet our prudential requirements.”

Merciful sought declarations that Suncorp was in breach of the agreement and an injunction restraining Suncorp from closing the account.

The Court of Appeal rejected the submission that it was not reasonable for Suncorp to close the account as it presupposed an obligation only to exercise the power to close the account if no lesser step is available.

The closure decision was supported by evidence of compliance with Suncorp’s AML/CTF program, its risk alerts and senior management review.

In Puleo v Bendigo and Adelaide Bank Ltd [2026] VSC 513 the Supreme Court of Victoria rejected a claim by the owners of a licensed brothel that in closing their accounts, the Bank:
(a) engaged in discrimination and breached the Equal Opportunity Act 2010 (Vic);
(b) breached the terms and conditions governing the operation of the accounts; and
(c) breached s 912A(1)(a) of the Corporations Act 2001 (Cth) as the decision to close the accounts was not made efficiently, honestly or fairly.

The customers also alleged that the clause permitting the Bank to close the Accounts under the Business Accounts Terms and Personal Accounts Terms was an ‘unfair term’ for the purposes of s 12BG(1) of the Australian Securities and Investment Commission Act 2001 (Cth) and should be declared void.

The Bank said that it decided to close the accounts to protect the Bank’s legitimate interests as it considered the customers to be outside the Bank’s risk appetite, as it could not adequately mitigate and manage the level of risk presented by continuing to provide banking and financial services to the customers.

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Case note: penalty for misleading conduct and false or misleading representations relating to financial products

David Jacobson — Mon, 03 Aug 2026 02:27:54 +0000

In Australian Securities and Investments Commission v Latitude Finance Australia (No 4) [2026] FCA 989, the Federal Court imposed penalties of $35 million against Harvey Norman Holdings Ltd and $20 million against Latitude Finance Australia for misleading conduct and false or misleading representations they made in a national advertising campaign promoting a 60-month interest free and no deposit payment method for goods purchased at Harvey Norman stores. Background.

Latitude and Harvey Norman failed to disclose in those advertisements that:
(a) an essential precondition for acquiring goods pursuant to the advertised payment method was that the consumer has or enters into a continuing credit contract linked to a credit card; and
(b) a consumer taking up the advertised payment method would, in addition to the purchase price, be required to pay a $25 establishment fee (during the period 1 January 2020 to 15 March 2021) and ongoing monthly account service fees, which since 1 January 2020 have increased from $5.95 per month to $10.95 per month.

The higher penalty imposed on Harvey Norman is likely to be appealed against.

Although Justice O’Bryan concluded that Harvey Norman and Latitude were equally responsible for the misleading advertisements, he considered that a higher penalty should be imposed on Harvey Norman in comparison to Latitude “to deter repetition and to motivate Harvey Norman to improve its compliance processes”.

In response to ASIC’s submission that Harvey Norman’s compliance culture was “particularly weak”, Justice O’Bryan observed:
“In relation to Harvey Norman, the evidence adduced with respect to its compliance systems and training can be described as paltry. No witness was called to give evidence about Harvey Norman’s compliance systems and training during the relevant period or presently….
Overall, Harvey Norman failed to establish that, during the relevant period, it had an effective system for seeking to ensure compliance with the consumer protection laws. That is a very serious matter for a company the size and scale of Harvey Norman, the principal business of which is the franchise of retail stores selling furniture, domestic appliances and computing and software products to the Australian public at large…
a striking feature of this case is Harvey Norman’s unwillingness, through a senior executive, to give evidence about Harvey Norman’s compliance procedures during the relevant period, why the procedures were inadequate to prevent the contravening conduct, and the steps that have been taken to prevent future contraventions. In the absence of such evidence, the apology from the bar table rings hollow…”

Referring to a press interview by Harvey Norman’s Chair, Justice O’Bryan observed:
“Mr Harvey is entitled to express his opinions, including about the legal system. However, Mr Harvey’s opinions indicate that the Chairman of Harvey Norman’s sole focus is upon the perceived injustice suffered by Harvey Norman, and a complete disregard for the potential harm suffered by consumers from Harvey Norman’s misleading conduct.
Taking the evidence as a whole, I am not persuaded that Harvey Norman has demonstrated any contrition for its wrongful conduct.”

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ASIC mortgage offset loan accounts report

David Jacobson — Mon, 03 Aug 2026 02:27:20 +0000

ASIC has published Report 837 Offsets (REP 837) containing the results of its review of the mortgage offset account practices of eight banks.

An offset account is a transaction account linked to an eligible home loan. The money in an offset account reduces the outstanding amount owed on the loan, which is used to calculate interest. By paying interest only on the net amount owed, offset accounts can significantly reduce interest costs over time and help customers repay their home loan sooner.

While practices varied significantly across the banks, ASIC found weaknesses in how all banks set up, monitored and managed offset accounts, resulting in some customers missing out on promised savings.

ASIC says the report is relevant for all banks.

Problems include banks linking accounts to the wrong home loan, not reducing interest charges as expected, and failing to respond to customer requests to open an offset account.

ASIC identified four key findings:

* Banks struggled to readily identify customer offset account requests – Many banks could not readily identify if, or when, customers had requested an offset account;
* Inconsistent detection of offset account failures – Some banks were unaware they were failing to deliver on promises to link offset accounts to home loans;
* Failure to compensate customers and slow to fix issues – Even when banks did identify potential offset account failures, some failed to adequately assess the extent of potential customer loss and compensate customers; and
* Lack of visibility of information on offset accounts for customers – Some customers had no easy way to confirm whether their offset account was set up, linked to the right loan and saving them interest, because they could not easily access key information in their bank’s mobile app.

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Bright Law | searchable regulatory information for Australian financial service providers

Cash Distribution Regulation Australia

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