Former clients of Prime Access are unlikely to have experienced any “detriment”, an ANZ advice executive has said, following the launch of a $30 million compensation project.
Yesterday, the bank announced that 8,500 customers of its Prime Access financial planning service will be eligible for refunds after a “review” found they had not received annual review documents they had paid for.
ANZ general manager for advice, Neil Younger, told consumer group Choice that the annual review – for which clients paid an approximate upfront fee of $3,500 – was “not essential” to the ongoing management of client portfolios.
“At a macro level, we don’t believe there has been any detriment, but I can’t account for every individual,” Mr Younger said in a statement on the Choice website.
The bank has chosen to embark on the major refund project because it “did not meet its contractual documentation requirements”, Mr Younger said, not because of inappropriate advice.
In a separate statement, Choice’s chief executive Alan Kirkland described the incident as an “epic fail” and said it was more broadly reflective of problems in the advice industry.
“While basic legal protections were recently put in place for people seeking financial advice, this is an industry that has been taking advantage of its customers for decades,” he said.
The announcement of a $30 million refund project also attracted the attention of Labor Senator Sam Dastyari, who is due to preside over a hearing in the Parliament next week which will see senior executives at the major institutions questioned over financial planning scandals.
“This is quite significant,” Senator Dastyari said on Twitter. “ANZ are in public hearings next week. ASIC is looking at all the banks.”
Fairfax reported yesterday that while NAB’s Andrew Hagger – who was recently grilled by the same committee – and representatives of the Commonwealth Bank and ANZ will appear before the committee, AMP and BT Financial Group are seeking to negotiate alternative appearance dates.
ANZ’s announcement comes as the corporate regulator has issued an update to its probe into the largest financial advice providers, which has found “multiple instances” of fees being charged for advice not provided.
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