ASIC confirmed on Monday that 404 customers were affected by the wealth giants’ conduct between September 2014 and August 2017.
The court found that during that time both companies:
- Made false or misleading representations to customers in customer account statements that no deductions of ongoing adviser fees were being made from customers’ accounts after those customers requested to remove their financial advisers from their accounts.
- Engaged in misleading or deceptive conduct by providing customers with account statements that did not show that BT and Asgard were continuing to deduct an ongoing adviser fee from customers’ accounts after those customers requested to remove their financial advisers from their accounts.
The court also found Asgard breached “its obligation to do all things necessary to ensure the financial services covered by its financial services licence were provided efficiently, honestly and fairly”.
“Misleading statements were made to customers, who were also charged for services they did not receive,” ASIC deputy chair, Sarah Court, said.
“The licensed financial services industry has an obligation to ensure that their systems and processes are reliable, accurate and their customers must be able to have trust in them.”
Justice Wheelahan said in his decision: “Financial services providers in the position of the defendants should not be able to take the benefits which arise from automated and offshore processes and systems, which it may be inferred contribute to substantial profits, without also undertaking the burden of ensuring that those systems work, and that they promptly identify occasions where they do not.
“An appropriate penalty should have the effect of deterring the defendants, and financial services providers generally, from maintaining defective systems, and conversely, providing an incentive to establish and maintain systems that are reliable.”
Westpac has indicated that it will pay the penalties and costs against BT and Asgard.
Can this go towards our levy or is this the champagne fund for ASIC for next Christmas party??
The latter.
So if an Adviser is accused by ASIC of doing similar even on ONE instance/occasion, they can be banned from working in any form in the entire Financial Services industry for years, lose their job, career, income & savings, reputation and clients. If the big end of town do it hundreds of times as long as they pay a fine it’s back to business as usual for them?? $3m to a group like Westpac would be like an Adviser paying a $5 fine to ASIC to have their problems go away. When is the government going to wake up and look at the rort that ASIC and their incompetent, biased, revenue raising public servant staff and do something about it?
not to mention ASIC increases the Adviser levy to cover the increased costs of supervision.
Just seems incredible – the fine is nothing for Westpac yet advisers doing the right thing still trying to work in this industry have seen the ASIC Levy go up by over 300% in 4 years. Take away their banking license would send a far stronger message.
The penalty should be a lot more then the fees us good advisers have to pay not have to go up by 30% !!
Chicken feed
That sounds like a stuff-up, not an organised scheme,
The below sounds like fraud not a stuff-up. They issued statements were they deleted a fee which was being paid, that is not someone on the call centre accidently giving incorrect information:
Engaged in misleading or deceptive conduct by providing customers with account statements which did not show that BT and Asgard were continuing to deduct an ongoing adviser fee from customers’ accounts after those customers requested to remove their financial advisers from their accounts.
If what you say is true then you are right.
Sounds like the current Intra Fund Advise fees? But I guess there would be more?