FPA enters CBA compensation fray

The FPA has put up its hand to oversee the compensation process for victims of the “unprecedented” and “appalling” Commonwealth Bank advice failure.

FPA chief executive Mark Rantall said a joint committee would not only serve the interests of impacted clients but work to restore client trust in CBA’s advice business.

“In the past few weeks we have seen unprecedented events unfold before our eyes,” Mr Rantall said.

“The FPA stands with those clients and is calling for a clear plan of action from the CBA to fully compensate all clients and ensure we don’t see a repeat of these appalling events in the future.

“We will agree to form a joint committee with CBA to commence the process of identifying all clients and establishing fair and reasonable compensation.”

The FPA said the joint committee would be chaired by an independent and highly respected individual, and that it would volunteer senior members of its leadership team to work within the group.

In addition, the FPA said the joint committee would review CBA’s existing professional standards, urge CBA to support membership of an approved professional body by reimbursing costs for planners and fully support the FPA’s 10-point plan.

Mr Rantall said the FPA is also calling for a summit with a “clear and independent charter around the changes needed to restore community trust in financial planning”.

“We would like to see the summit chaired by an eminent, independent figure,” Mr Rantall said.

“We think it’s about time the entire industry regulated itself in co-operation with government, regulators and community stakeholders.

“If we can’t have a summit which commands the respect of the public, one with genuine teeth that can truly deliver positive changes, we would fully support calls for a Royal Commission.”

The FPA’s call for compensation follows recent commentary by law firm Maurice Blackburn to ifa over whether a Royal Commission could produce timely results for affected Commonwealth FP clients.

“I think it needs to be fixed and it also needs to be done quickly and I think the Royal Commission is just too far off,” Maurice Blackburn partner John Berrill said.

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