The Commonwealth Bank of Australia (CBA), the country’s largest by assets, was told to provide the money after a review found “inconsistency and deficiencies” in an initial A$52m (£26.8m, $40.2m) compensation scheme.
ASIC on Thursday released a report authored by KordaMentha Forensics into the CBA’s compensation schemes, which had originally been set up following the exposure of misconduct by its financial advisory arm Commonwealth Financial Planning Ltd (CFPL) as well as the CBA-owned Financial Wisdom Ltd (FWL).
“Following the release of today’s report, the first of three to be delivered to ASIC, Commonwealth Bank (CBA) will contact approximately 2,740 customers to offer them up to $5,000 to have their advice assessment reviewed and to seek independent advice,” ASIC said in a statement.
“The licensees will also write to a further 1,590 clients informing them that a review of their file found no evidence that they had received advice, but if that is not correct, the clients will be offered $5,000 assistance,” it said.
ASIC appointed KordaMentha to examine the two Commonwealth Bank financial planning arms in November last year, and it is due to provide three reports on the matter.
The second report will assess whether the two planning arms had a reasonable basis for identifying the clients and advisers for the original compensation scheme. If other clients or advisers should have been captured, they will be required to rectify this.
The third report will provide an assessment of this work and CFPL and FWL’s compliance with the licence condition program.
