ASIC warns major banks’ fees-for-no-service reviews are incomplete and delayed

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ASIC’s FFNS supervisory work includes overseeing the associations ’ plans to compensate customers affected from the reported failures to give information services compensated by clients, in addition to the associations’ reviews to determine whether there were additional systemic FFNS failures in addition to those already recognized and reported to ASIC.
ASIC warns that most of the institutions are yet to finish reviews to identify systemic FFNS failures beyond those already identified and reported on ASIC because 2013. The reports are incomplete and postponed, the regulator warns.

“These testimonials are unreasonably delayed. ASIC acknowledges they are large scale testimonials — they relate to systemic failures over extended spans with reviews going back six to ten years and cover 36 licensees in the six institutions that now authorise more than 7,000 advisers However, we consider the associations have failed to sufficiently prioritise and source their testimonials, particularly as ASIC advised them to commence the testimonials in mid-2015 or early 2016”.

Under the compensation programs, AMP, ANZ, CBA, NAB and Westpac have collectively paid or provided roughly $350 million in compensation to clients who were charged financial advice charges for no support in the conclusion of January 2019. Moreover, the associations have provisioned more than $800 million towards possible compensation for additional systemic FFNS failures. Nevertheless, these testimonials are faulty.
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The Australian Securities & Investments Commission (ASIC) has earlier today published an upgrade  on inspection programs undertaken by AMP, ANZ, CBA, Macquarie, NAB and Westpac about fees-for-no-service (FFNS) failures.
ASIC Commissioner Danielle Press commented:

At end-January 2019, the licensees have already paid offered roughly $316 million in FFNS compensation to over 120,000 clients who have been charged fees for individual information. Obviously, some $235 million has come from licensees owned by the institutions. Separately, NAB’s superannuation trustee, NULIS Nominees (Australia) Ltd, has already paid or offered over $116 million compared to ‘program service charges ’ for general information.

The regulator says it’ll continue to oversee and record on the institutions’ further inspections in to FFNS failures.
FinanceFeeds –

Together with oversight of the settlement programs and further reviews undertaken with the institutions, ASIC can also be carrying out a number of FFNS analyses and plans to take enforcement actions against licensees that have engaged in misconduct.

Some of the key reasons for delays by the associations incorporate poor record-keeping and systems inside the institutions, which imply that in several cases they’ve been unable to get customer files for inspection, or failures by several associations to implement customer-centric methodologies to identify and compensate customers. Also, some institutions have taken a”legalistic approach” to conclusion of the services that they have been required to supply.