ANZ taken to task over ‘misleading’ general advice

The royal commission has heard it was “misleading to even call” ANZ’s A to Z review program advice as it delved into the business’ superannuation practices.

ANZ head of superannuation Mark Pankhurst was confronted by questions regarding an enforceable undertaking it entered with ASIC earlier this year over the provision of general advice under it A to Z review program.

Counsel assisting Michael Hodge noted that the A to Z review program consisted of three steps’ “discussing a customer’s current financial position”, “discussing the customer’s future goals”, and finally an offer of retail banking products, thought this third step was separated by a “de-linking” statement intended to specify that it is not related to the information discussed in previous steps.

However, Mr Hodge contended that the program itself was “doing something with the aim of causing people to enter the product” the adviser suggested.

“Do you think it's misleading to even call it advice?” Mr Hodge asked.

Mr Pankhurst told the commission that general advice is a “challenging issue” as it is intending to provide information to clients within a legal framework, stating the intention behind the program is to “make people aware” of what certain products can do for them.

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“It must be a bit more than [that] though, isn't it, it's not just telling people about the product. ANZ wants people to take the product up?” Mr Hodge pressed.

“That's correct, yes,” Mr Pankhurst said.

Mr Pankhurst’s remarks that general advice presents a challenge to providers reflects similar comments made to ifa by Smart Compliance principal Brett Walker in July.

Mr Walker told ifa that it is “extremely difficult” for banks to meet the legal requirements under the general advice regime as gathering data from clients on their existing holdings in financial products “is at the heart of the in-house distribution drive”.

“Banks will need to better script the processes and train staff about how not to fall into the personal advice trap,” he said.

The royal commission’s public hearings on superannuation continue today, with ifa sister title InvestorDaily covering the action live here.

ANZ taken to task over ‘misleading’ general advice
ANZ, Mark Pankhurst, General Advice, superannuation, royal commission, Michael Hodge, Kenneth Hayne, Ken Hayne
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