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Response to Fairfax Media regarding Commonwealth Financial Planning and Don Nguyen

Saturday, 1 June 2013

Don Nguyen was employed as a financial planner in Commonwealth Financial Planning from October 2003 until his resignation in July 2009.

In 2008, following complaints from clients to the Commonwealth Bank and to Australian Securities and Investment Commission (ASIC), we became concerned about the advice provided by Mr Nguyen.

Those concerns were investigated and saw Mr Nguyen suspended from duty. Mr Nguyen subsequently resigned whilst under investigation.

These investigations resulted in our decision to undertake a complete review of all client files managed by Mr Nguyen.

Commonwealth Financial Planning engaged an independent consultant – agreed to by ASIC – in relation to both the formal review of the client files and the methodology we applied to rectify issues and give impacted clients a fair and reasonable outcome.

Where this formal review determined Mr Nguyen provided unsuitable advice to clients that warranted rectification, clients were offered appropriate compensation. The vast majority of clients have accepted our offer.

We are committed to ensuring that the small number of clients who are yet to accept our offer receive appropriate independent legal, accounting or financial advice and have offered financial support so they can obtain this.

Where clients have not availed of this support or remain dissatisfied, we have encouraged them to engage the Financial Ombudsman Service, which is the appropriate forum for investigation of their concerns.

We acknowledge that a small number of Mr Nguyen’s former clients received offers of compensation before our formal investigation. Where the subsequent review determined that the client may have been due a higher level of compensation, this offer was made.

Commonwealth Financial Planning raised breach notices with ASIC in relation to other planners identified from outcomes of our investigations into Mr Nguyen. These planners have subsequently received banning notices from ASIC.

Commonwealth Financial Planning identified ways to improve the supervision and monitoring of our advisers and has been making these changes.

In October 2011, Commonwealth Financial Planning gave an Enforceable Undertaking to ASIC. Throughout the investigation of this matter, we have worked with the requirements of this EU and continue to co-operate with any requests from the ASIC-appointed independent expert.

We acknowledge it was a difficult process reviewing some of Mr Nguyen's client files. Where documentation was lacking, we contacted those clients and asked for their records and we used these to assist our review.

For more information, customers can phone Commonwealth Financial Planning (Advice service Centre) - 1800 214 996.