The Commonwealth Bank Group (the Group) acknowledges the interim report from the Senate Economics References Committee (Senate Committee) inquiry into the performance of the Australian Securities and Investments Commission (ASIC).
The Group made a submission to the Senate Committee inquiry on 11 November 2013, and provided additional information on its submissions to the Senate Committee on 16 May 2014. This additional information notes that some of its remediation activity relates to former Financial Wisdom (FWL) financial advisers, as well as former Commonwealth Financial Planning (CFPL) financial advisers. It further notes that communication to customers and the offer to reimburse the cost of independent advice were not applied consistently. CFPL and FWL agreed to a variation to the AFSL conditions with ASIC that will ensure consistency.
We continue to co-operate with a request for additional information from the Senate Committee.
We note ASIC’s statement on 16 May 2014 that there are no issues identified with the file reviews conducted in neither the compensation process nor the amounts of compensation offered to customers.
We remain extremely disappointed that a number of former CFPL and FWL advisers did not provide quality advice to some customers in the past. The Group has no tolerance for behaviour that prejudices the financial wellbeing of our customers. We have worked with affected customers to put things right, remediating them to the position they would have been in had they received appropriate advice.
CFPL is now a significantly transformed business. It has undergone structural, cultural and management changes, with robust systems and processes in place for the supervision and monitoring of advisers. The supervision and monitoring framework has also been applied to FWL.
What this means for CFPL and FWL customers
Affected customers will receive a letter from CFPL or FWL outlining the process and next steps, with details of an offer to pay up to $5,000 to qualified advisers for independent advice. In the meantime, if any of our customers are concerned, please contact CFPL on 1800 507 281 or FWL on 1800 508 169 (8:30am – 5:00pm Monday – Friday).