The banking industry has called behavior by the banks revealed in the financial services royal commission “unacceptable”.
Commission hearings have heard of customers being charged for financial advice they didn’t receive, of dead people being charged fees, and of false and misleading statements made to the corporate regulator, ASIC.
The federal government also announced fines of more than $200 million and 10-year jail terms for corporate wrongdoing.
And today the CEO of AMP, Craig Meller, resigned after revelations in the royal commission showing that the financial services giant has made false statements to ASIC.
Anna Bligh, CEO of the Australian Banking Association, says the past few days of hearings at the Royal Commission have been “sobering” for the industry.
“The issues raised have been unacceptable and do not meet the high standards the community rightly expects of banks,” she says.
“Australia’s banks are committed to tackling misconduct head-on and strongly back the reforms proposed today by the Turnbull Government to penalise bad conduct within the industry.”
She says a stronger range of penalties for misconduct is vital to tackling criminal and unacceptable behaviour by individuals and corporations.
The industry has supported the strengthening of the penalties regime for misconduct since the Federal Government announced its review 18 months ago, as an outcome of the Financial Services Inquiry.
Bligh says the banks had already recognised the need for change and have put in place a rigorous conduct background check for bank employees to stop those with a history of misconduct simply moving from one institution to another.
“Many of the issues raised over the last few days are the subject of investigation with changes already underway in the sector to ensure cases such as these cannot reoccur,” she says.
“The industry expects that further changes should and will be made following the final recommendations of the Commission.”
The Financial Services Council also supports an increase in criminal and civil penalties for corporate misconduct in order to better protect consumers.
“There is no place for criminality in the financial services industry and wrongdoing should be met with the full force of the law,” says council CEO Sally Loane.
“It is entirely appropriate that penalties for civil and criminal misconduct are as strong as possible.
“Consumers must have confidence that the individuals and organisations they entrust with their savings will act in the right way. Both effective enforcement of the law as well as severe punishments for wrongdoing are central to promoting better trust and confidence.”
Business Insider Emails & Alerts
Site highlights each day to your inbox.