ASIC has revealed that two CBA-owned dealer groups have failed to meet some of their licence conditions, which relate to compensating the clients of 15 former advisers.
In a statement, the regulator announced that while Commonwealth Financial Planning and Financial Wisdom Limited have complied in most instances with their licence obligations, they failed to meet some of the specified time-frames.
Back in 2014, ASIC had imposed AFSL conditions on the licensees that required them “to communicate with and compensate customers of 15 former advisers for advice they provided between 2003 and 2012”.
The licence conditions were imposed after CBA informed ASIC that there were inconsistencies with the implementation of an initial customer compensation process.
ASIC today released the findings of a progress report, conducted by KordaMentha Forensic, which found that while most licence obligations had been complied with, “in some instances, the licensees failed to meet the timeframes specified in the additional licence conditions".
“In those instances, the licensees failed, within the required time-frames, to communicate with customers or provide them and their independent advisers with relevant information to help them to assess their advice or compensation,” ASIC said.
“The licensees subsequently rectified these deficiencies by providing the information to the clients and advisers. ASIC does not propose taking any further action."
The report also provides an update on compensation outcomes arising from the additional licence conditions.
To date, the additional licence conditions have resulted in a further $4.96 million being offered to 185 customers of the 15 advisers. This is in addition to the $26.97 million paid to 707 customers of the same 15 advisers under a previous compensation program, ASIC said.
This compensation outcome is separate from the 'fee for no advice' failures and CBA's Open Advice Review program.
The next report regarding the licensees' current review of advice given in 2012 and earlier by 17 further potentially high-risk advisers, including any further compensation outcomes, will be published by ASIC in 2017, the statement said.
Following the announcement, CBA said the report issued today confirms that the licensees took appropriate action to contact more than 4,300 customers in 2015.
"This report shows we have continued to deliver on our commitment to customers and demonstrates the thorough approach we have taken to identify any past issues and put things right for customers," said CBA general manager for advice review program, Leif Gamertsfelder.
SUBSCRIBE TO THE IFA DAILY BULLETIN
- 18 Feb 2019ASIC appeals Westpac best interests court decisionBy Adrian Flores
- 18 Feb 2019FASEA mostly funded by the major banksBy Adrian Flores
- 15 Feb 2019ASIC to undertake harsher penalties against banksBy Eliot Hastie
- 18 Feb 2019NAB most distrusted bank, survey findsBy Sarah Simpkins
- 15 Feb 2019Court restrains unlicensed firm from operatingBy Adrian Flores
- 15 Feb 2019ASIC used Dover whistleblowing to shut licensee downBy Adrian Flores
- view all