Commonwealth Bank CEO Ian Narev has announced an ‘open review program’ to investigate the advice failures at CBA dealer groups Commonwealth Financial Planning and Financial Wisdom.
In a statement, Mr Narev said the new “far reaching program of review” will demonstrate the bank’s commitment to remediation and will have “no cost to customers”.
"Poor advice provided by some of our advisers between 2003 to 2012 caused financial loss and distress and I am truly sorry for that," Mr Narev said. "We know this is unacceptable and I unreservedly apologise to all customers affected."
The aim of the bank’s compensation program will be to “put customers back in the position they would have been had they received suitable advice” as well as addressing concerns raised during the Senate committee’s inquiry.
The program will include a dedicated hotline for former clients and opportunity for an assessment of any advice received during the relevant period – to be conducted by a “specialist Commonwealth Bank team and followed up by an audit by an “independent customer advocate” funded by the bank.
There will also be an additional panel for customers who are not satisfied by the results of an assessment, which will be binding on the bank.
Mr Narev reminded stakeholders that aggrieved clients will still have the option of taking the matter to the Financial Ombudsman Service.
Several firms have been impacted by the corporate regulator’s action.
Super funds must now have a retirement income strategy in place.
Vanguard has called for a complete overhaul of the advice industry.
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