- A Westpac financial adviser still managed to get monthly bonuses despite getting poor performance reviews.
- He left the bank under investigation for serious breaches of duty.
- But Westpac didn’t tell his new employee when it contacted the bank for a reference.
Westpac didn’t tell Dover Financial Advisers that an adviser it hired, Andrew Smith, was under investigation for “serious misconduct” at the bank, according to the financial services royal commission.
Smith, a senior financial planner with St George from May 2007, came to Westpac in the takeover of 2008.
He resigned in 2015, following complaints and an audit that indicated he was a high risk because he kept scant records and charged customers without servicing them.
The commission was told Smith’s actions cost the bank more than $2 million in remediation payments to 91 customers.
Dover asked Westpac for a reference on Smith. The bank only replied that “there were concerns about his conduct” but did not give details of his breaches of duty.
In the royal commission today, Michael Wright, head of Westpac’s BT Financial, said: “At the time that was our approach, clearly that’s not the case today.”
Wright said that, according to ASIC records, Smith was still an authorised representative of Dover Financial Advisers.
Evidence was given that Smith received very low ratings in internal reviews at Westpac but still was awarded bonuses.
Rowena Orr, senior counsel assisting the commission said: “It must have seemed likely to anyone who was looking at the whole picture in relation to Mr Smith, that there were significant problems with his advice.”
Wright: “I agree with that.”
But Orr pointed out Smith continued to be eligible, despite the complaints and results of the audits, for his monthly bonuses.
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