In its official submission to the Senate inquiry into the performance of the Australian Securities and Investments Commission, CBA acknowledged the concerns of parliamentarians over advice provided to some consumers in the past and pointed to its compensation activities.
“[Commonwealth Financial Planning] acknowledges that in the past a small number of its advisers, none of whom remain with CFP, provided inappropriate advice to some customers,” the submission states.
“CFP deeply regrets that some of its customers were impacted in the past by poor advice they received from those advisers. CFP has no tolerance for behaviour that prejudices the financial wellbeing of its customers.”
The submission lists a number of actions aimed at remediating aggrieved former clients, including compensation commencing in 2010, investigation of the quality of advice provided to customers and providing access to independent legal and qualified financial advice for affected customers.
It also pointed to transformation of the structure of its financial advice business, as reported by InvestorDaily in September, when CBA executive Marianne Perkovic revealed changes within the banking group’s advice business.
In order to avoid similar incidents occurring in the future, the submission also outlines its support for a number reforms providing additional scrutiny of the financial advice market.
“Notwithstanding the positive impact that the FOFA reforms are having on the financial planning industry, CFP advocates that consideration should be given to ensuring that those licensed to give financial advice are of good character,” the submission states.
Specifically, the submission backs ASIC’s suggestions to ensure “requirements for entry into the industry and becoming licensed to provide financial advice are appropriate” as well as supporting the call for ASIC to maintain a register of financial planners.
The bank also called for “the introduction in Australia of a financial planner passport scheme similar to the one operating in the United States”.
The passport scheme should be “administered by ASIC and funded by industry” the submission states.
