ISA points to ‘behavioural problems’, ABA hits back

The Australian Bankers’ Association, Industry Super Australia and NAB have issued responses to the ASIC report into how financial advice institutions have dealt with non-compliant advisers, which ISA says "sounds a warning".

In a statement on Friday, ISA chief executive David Whitely said, “The findings highlight persistent behavioural problems within the wealth management arms of the big banks.

“The banks and their subsidiaries have a deeply entrenched sales culture that runs counter to consumer interests and is clearly incompatible with the public policy objectives of compulsory superannuation.”

Meanwhile, the Australian Bankers’ Association (ABA) has responded to the report by saying that the banks were currently working with government and regulators on a number of reforms.


“ASIC has an important role in undertaking regular reviews of the industry and we are committed to working with ASIC and other stakeholders on the findings of this report,” said ABA executive director of retail policy Diane Tate.

“The industry is driving its own reforms to improve the quality of financial advice. This includes a new industry-wide hiring protocol so banks can find out more about a financial adviser’s previous conduct history.”

NAB also responded to the report, commenting that “since ASIC began this project in 2015, NAB has made a number of changes across its wealth advice business – including its adviser audit practices – and continues to make improvements”.

“While ASIC has not yet shared with us any findings that relate to NAB individually, we welcome any discussions the regulator wants to prioritise that will benefit our customers,” the bank said.

ASIC Report 515 Financial advice: Review of how large institutions oversee their advisers examined the conduct of financial advice licensees controlled or owned by AMP, ANZ, CBA, NAB and Westpac, looking at how these firms responded to non-compliance between 1 January 2009 and 30 June 2015.

The report found a number of “areas of concern” including failure to notify ASIC of serious non-compliance concerns, significant delays between the institution becoming aware of misconduct and reporting it to ASIC, and inadequate background and reference checks.


ISA points to ‘behavioural problems’, ABA hits back
ISA says ASIC report proves banks have ‘behavioural problems’
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