CHOICE says ANZ’s announcement about a failure to deliver services to financial advice clients is yet more damning evidence of fundamental flaws in Australia’s financial advice industry.
The news comes in the wake of NAB’s financial planning scandal in February, which saw hundreds of consumers fighting for millions of dollars in compensation for the poor financial advice they received.
“The customers ANZ failed will welcome this $30 million fee refund but the industry at large needs to think about cleaning up the mess it has created by treating financial advice as a sales pipeline,” says CHOICE CEO Alan Kirkland.
“While basic legal protections were recently put in place for people seeking financial advice, this is an industry that has been taking advantage of its customers for decades. In this case, ANZ sold a product and didn’t deliver an essential component to an estimated 8,500 people.
“These scandals from major banks will keep coming. If they’re serious about making amends, all major financial advice firms should be reviewing their advice and transparently offering compensation to wronged clients.
“In this case, we’re talking about people who didn’t receive a documented annual review on their investments, insurance or superannuation products over a significant period.
“ANZ haven’t been able to demonstrate that their clients are not worse off due to this failure. They need to undertake a transparent review of all individual cases to assess the damage they realistically could have caused.
“Customers who have purchased the ANZ Prime Access service should be asking their adviser to confirm that they’ve delivered everything that was paid for and to question the need for ongoing fees.
“ANZ has taken over ten years in some cases to determine that a service was paid for but not delivered. It will even longer before customers receive any reimbursement. This, quite simply, is unacceptable.
“ANZ claims this is a small problem affecting only a handful of customers but we need to put this issue in context. In the last ten years we’ve seen scandal after scandal where advisers didn’t have their clients’ best interests at heart.”