Commonwealth Bank refunding millions in fees for no service

In its three submissions to the Royal Commission, Commonwealth Bank has admitted to at least $118.5 million of fee for no service misconduct.

Providing examples of misconduct by authorised representatives and financial advisers employed by CBA and related entities, Senior Counsel Assisting Rowena Orr said between July 2007 and June 2015 clients of Commonwealth Financial Planning, BW Financial Advice and Count Financial were charged ongoing fees for advice without receiving advice.

In its submissions CBA said that as at 31 December 2017, about $118.5 million in refunds, including interest, had been offered or paid to customers.

CBA acknowledged since 1 January 2013, it has made 20 breach notifications to ASIC in relation to actual or potential breaches of the Corporations Act by advisers licensed by Commonwealth FP, Financial Wisdom or Count Financial. A further five notifications were made in relation to advisers identified through subsequent file reviews.

CBA advice failures unacceptable: Comyn

It also acknowledged notifications were made in regards to a further 20 advisers for serious compliance concerns, good governance notifications were made in relation to an additional 13 advisers and 15 former CBA advisers have been the subject of ASIC banning orders and/or enforceable undertakings.

As at the end of 2017, CBA has paid or offered to pay about $96 million in compensation to customers in relation to poor financial advice or adviser misconduct.

Orr said that in its final submission, CBA outlined 76 separate instances of misconduct identified over the last five years in regards to financial advice.

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Read more: CBARoyal CommissionCommonwealth BankASICCount FinancialBW Financial AdviceCommonwealth Financial PlanningFinancial StandardFinancial WisdomRowena Orr
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