Australian banks are scrambling to rebuild trust with consumers and do the right thing amid damning revelations that they have profited from the dead.
It’s the story no company wants to be associated with. Invoicing the dead is a charge that doesn’t go away in a hurry, no matter how many announcements you make. PR-drafted platitudes about customer care, reforms and better outcomes won’t fix this.
Screwing people over while they are still breathing is one thing. Continuing to pick their pockets while they are dead is simply deplorable.
On Wednesday morning, the Australian Banking Association announced that the industry will make sweeping changes in light of this and other shocking revelations to come out of the royal commission.
These reforms are the first of several key changes in response to the royal commission and include ending ‘fees for no service’,” ABA CEO Anna Bligh said.
“Banks will change the way they manage ongoing financial advice, proactively contacting customers to confirm what advice is required and only charging for what is provided.”
The industry will also be changing the Banking Code of Practice to improve the way banks manage a deceased estate.
“Once notified of a customer’s death, banks will proactively identify fees that are for products and services that can no longer be provided in the circumstances, stop charging those fees and refund any paid.”
The fact that banks need to announce this is almost farcical. ‘Banks vow to stop charging dead Aussies’ is the headline we ran with in our sister publication, ifa; it could have easily been pulled from the pages of satirical news sites like The Onion or The Betoota Advocate.
Of course, the ABA’s announcement comes just 24-hours after the Commonwealth Bank’s own statement. CBA was the first to reveal an overhaul to its wealth management business this week, including no more charging dead people and no more fees for no service.
But all of this just seems too little too late and will never erase the fact that banks knowingly made money off the dead. In fact, any announcement that references the morbid activity simply reminds us of its abhorrent absurdity. The banks will no doubt be haunted by this for a long time to come.
While CBA’s efforts to change its ways should improve customer outcomes, Morningstar analyst David Ellis noted this week that “if the bank had done the right thing originally, then these embarrassing announcements would not be necessary.”
He’s right – banks like CBA should have been doing the right thing from the start. Australians trusted them and that trust has been broken, buried and then hit up for a fee far too many times.
It will take more than a few announcements for living Aussies to trust the big four again. As for the deceased, may they all rest in peace and no longer be pestered by the banks.
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