The CEO of Australia’s biggest bank Ian Narev has apologised to customers of the bank’s financial planning business who lost money as a result of poor practices of financial planners.
Commbank CEO Ian Narev described the behaviour by the financial planners as “disturbing”.
“We know this is unacceptable and I unreservedly apologise to all customers affected. Poor advice provided by some of our advisers between 2003 to 2012 caused financial loss and distress and I am truly sorry for that,” he said in a statement
The bank has been under pressure since a Senate inquiry report criticised the the bank over its responses to claims of fraud and misconduct by some Commonwealth financial planners.
Mr Narev today announced what he called an Open Advice Review program, to fix any wrong and “make it right for our customers”.
The program will provide an assessment of the financial advice and will give those affected access to an independent advocate and an independent review panel.
The bank has already paid $52 million in compensation to more than 1,100 customers of specific advisers who were identified as having provided poor advice.
“I acknowledge there are views among some customers, and indeed in the Senate report released last week, that our approach has not been sufficient for all our customers,” he said.
The key features of the Open Advice Review program:
- Any customer who received advice from CFP and FWL between 1 September 2003 and 1 July 2012 and has concerns regarding that advice will be able to call a dedicated number and request an assessment of any advice received in the review period;
- The review of the past advice will be conducted by a specialist Commonwealth Bank team;
- In conducting a review, the specialist team will share the information it has available with the customer and will invite the customer to provide information that the customer has available;
- Once the review is complete the customer will receive an assessment and the offer of an independent customer advocate funded by the Commonwealth Bank;
- A customer who does not agree or is concerned with the assessment will have the option of a further review by an independent panel, determining whether compensation is payable and, if so, how much;
- The Commonwealth Bank will be bound by the outcome of the panel’s determination. However, the customer will not be bound and will still have the option of taking the matter to the Financial Ombudsman Service or pursuing a claim in respect of the matter; and
- We will also have the process overseen by an independent expert who will make their periodic reports public.
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