The financial services royal commission has uncovered more instances of dead people being charging fees for advice.
Superannuation fund Colonial First State, owned by the Commonwealth Bank, says its trustee Avanteos Investments found in 2015 that it was charging fees to the estates of dead people.
Corporate regulator ASIC and the prudential regulator APRA were informed about the breach.
Michael Hodge, senior counsel assisting the commission, said the issue was that the fund continued to charge adviser service fees to members after they had died.
Linda Elkins, the Executive General Manager of Colonial First State, told the commission: “…the conclusion we made was the practice should cease and should never have occurred.”
At one stage the trustee considered telling customers their estates would be charged adviser fees after they died, but didn’t.
Deloitte has been hired to investigate why this didn’t stop.
Colonial First State is reviewing processes for deceased estates to see if there are any other issues.
“But certainly on this issue we cease the fees upon notification of death,” she said.
At a hearing earlier in the year, the commission was told that Commonwealth financial advisers kept charging fees to customers who had died.
One adviser didn’t provide any customers with advice and then charged a client six months after they had died. He was forced to repay the fee to the dead person’s children.
And last week the commission was told the NAB discovered in May this year that it had been charging fees for financial planning advice to a customer who was dead.
Business Insider Emails & Alerts
Site highlights each day to your inbox.