CBA is “comprehensively addressing” the issues impacting customers of its aligned advice businesses – including Count Financial, Financial Wisdom, and Commonwealth Financial Planning-Pathways – and has provisioned $300 million for remediation costs.
“Significant resources have been committed to a comprehensive program of work, to ensure all issues are identified and remediated,” CBA said in a statement.
The total to-date aligned advice remediation provision recognised is $834 million, which includes $698 million in customer refunds (including $280 million of interest) and $136 million in program costs.
“While these additional provisions are estimates that may change, CBA believes it has adequately provided for these issues,” the bank said. “CBA will continue to monitor the adequacy of these provisions.”
Of the total $1B in remediation expenses the likely breakdown is:
– 5% refunds where service was paid for but not provided
– 65% refunds where service was paid for and [b]was[/b][b][/b] provided
– 30% in compliance bureaucracy overhead
There will be a lot of unemployed (and probably unemployable) compliance bureaucrats once this “remediation” gravy train stops.
Who said the gravy train is going to stop. Financial services and banking are rife with consumer, regulatory and legal issues. Get on the train. Toot toot…
The new growth industry…….Compliance (i.e. Gestapo)
On the plus side, we have a lot of happy clients that got paid ‘refunds’ for advice they had received. Banks money, not ours so we are happy for our clients.
As long as the bank doesn’t try to claw it back from you as the alleged “adviser who failed to provide service”. Adviser clawbacks are the next big shitfight coming with this whole “remediation” scam.