In a statement, the corporate regulator said ANZ’s OnePath will be reviewed after the bank reported breaches in relation to its life, general insurance, superannuation and funds management activities.
These activities are operated through its wholly-owned OnePath group of subsidiary companies.
According to the statement, from early 2013 to mid-2015, around 1.3 million customers were affected by breaches, requiring refunds and compensation of around $4.5 million. This also required rectifications and other remediation of about $49 million, ASIC said.
In one instance, 1,400 superannuation fund members had $28.7 million in contributions allocated to the incorrect super account for a period up to 12 months.
ANZ has now returned these funds to the correct accounts and provided over $400,000 in compensation for lost earnings and/or incorrect fees, the statement said.
OnePath also failed to take further action in relation to 21,000 cheques it had sent to customers that were not banked within 15 months.
These cheques included proceeds of insurance claims, superannuation benefits and refunds of premiums. $2.9 million was ultimately returned to customers, with a further $11.6 million treated as unclaimed monies.
ASIC was concerned that these breaches reflected compliance issues, which may impact the AFSL obligations of entities within the ANZ Group.
ANZ has engaged PricewaterhouseCoopers to independently review the OnePath subsidiaries’ compliance management framework, the statement said. The bank has also agreed to take appropriate actions to implement recommendations stemming from the PwC review. ASIC will further monitor the rectification of the breaches.
ASIC deputy chair Peter Kell said: “Appropriate compliance and systems to monitor compliance are essential for banks to adhere to their AFS obligations. This is important in maintaining customer trust and confidence in the sector.”
“ASIC expects all AFS licensees to have systems in place to ensure they can satisfy their general AFS obligations.”
Other breaches include failure to provide disclosure documentation for some insurance products and having inadequate systems or processes to ensure compliance.
“In some cases processes did not ensure reasonable steps were taken to contact customers or that statutory timeframes were met. Some processes included manual steps that were not followed up on,” ASIC said.
Further, there was insufficient supervision of some outsourced functions as well as some processing errors, such as payments made to incorrect superannuation accounts.
The PwC review will review and assess the design and operational effectiveness of the OnePath compliance management framework, including policies and processes. It will also assess the adequacy of processes designed to identify and manage the financial services laws which apply to the OnePath companies holding AFSLs.
In addition, it will identify any gaps in the compliance management framework and report back to the ANZ Group and ASIC.
As a former ANZ staff member all I can say is that….ANZ never makes mistakes..pmsl…couldn’t have happened to a nicer blood sucking organisation….
Oh and Onepath actually accepted some customers????
For the previous 6 comments by PC, ‘What Do You Expect’, Simon, Dave, Gav and Adrian, whoever came in a simply marked your comments as negative, they’ve just been reinstated as legitimate thoughts.
And to add weight them – I agree. Just another example of an FSC member being the cause of the industry’s heartache – NOT US NON-ALIGNED ADVISERS!
OnePath and wealth has always been an outlying Business Unit at ANZ … very much autonomous and woth little cross management between the “bank” and the wealth management functions. ANZ mgt have had one eye on the Asia gold mine as they see it and so some domestic Businesses have slipped through the cracks.
ANZ has ownership 40 odd Dealerships, that in itself is a huge compliance undertaking let alone the areas of Funds Management, Life products and Claims to name just a few. Why were Banks ever allowed to own Dealerships? Was it because Banks were seem as the ones that could do no wrong. From my understanding a greater majority of Client ASIC claims are related back to Banks and or Bank Advisors and yet us good people always made out to be the bad eggs.
Awesome, so another member of the FSC that is trying to destroy advisers has been caught red-handed. Maybe this whole LIF debacle was to distract ASIC… How then can ASIC and the government consider taking the “code of conduct” that the FSC is developing seriously???
Damn, here we go again
CBA, ANZ, Macquarie.
are there any more to further negative sentiment
Now there’s a surprise……not. The service standards have been slipping significantly for a while.
Rather disappointing result ANZ.