ASIC update on compensation for financial advice related misconduct
In an update released today, ASIC has revealed that six of Australia’s largest banking and financial services institutions paid or offered a total of $749.7 million in compensation, as at 31 December 2019, to customers who suffered loss or detriment because of non-compliant advice or fees for no service (FFNS) misconduct.
AMP, ANZ, CBA, Macquarie, NAB and Westpac (the institutions) undertook the review and remediation programs to compensate affected customers as a result of two major ASIC reviews. The regulator commenced the reviews in 2015 to look into:
- how effectively the institutions supervised their financial advisers to identify and deal with non-compliant advice.
- the extent of failure by the institutions to deliver ongoing advice services to financial advice customers who were paying fees to receive those services.
The table below provides a breakdown of the compensation payments made or offered by the institution as at 31 December 2019.
Institution | FFNS misconduct
| |||
| Compensation paid | No. of customers paid compensation | Compensation paid or offered | No. of customers paid or offered compensation | |
| AMP | $26,654,023 | 1,987 | $140,459,870 | 193,167 |
| ANZ | $36,205,259 | 1,777 | $59,415,383 | 21,184 |
| CBA | $9,386,454 | 628 | $164,846,374 | 50,576 |
| Macquarie | Not applicable | Not applicable | $2,583,645 | 734 |
| NAB | $39,944,208 | 1,294 | $163,862,768 | 586,961 |
| Westpac | $29,680,142 | 1,365 | $76,686,356 | 19,441 |
| Total | $141,870,086 | 7,051 | $607,854,395 | 872,063 |