The banking group first agreed in May this year to undertake “significant further work in relation to the compensation process for customers” and to put in place independent monitoring of that work, as reported by InvestorDaily.
CBA said in a communication released on Friday that these conditions involve contacting more than 4,000 customers to inform them advice they had previously received was now “subject to an internal review due to the fact their adviser had provided poor advice to some customers”.
The bank also said it has agreed to offer these customers the support of a qualified adviser such as a lawyer, accountant or financial adviser to seek independent advice in relation to that review, with fees up to $5,000 being met by the Group.
“The implementation of the varied licence conditions ensures all relevant customers are treated consistently,” CBA said in the statement.
“Extending the offer for independent advice further underscores our commitment to openness and transparency in any remediation for customers.”
A statement on the ASIC website said the corporate regulator will appoint an external compliance expert to oversee the AFS licensees’ compliance with the conditions.
“The expert will also review whether the steps taken by the AFS licensees to identify both the advisers and the clients that were covered by the compensation program were reasonable,” said the corporate regulator.
“The AFS licensees will be required to address any deficiencies identified by that review.”
CBA said Commonwealth Financial Planning Limited is now a “transformed business” that has undergone “structural, cultural and management changes, with robust systems and processes in place for the supervision and monitoring of advisers”.
“The supervision and monitoring framework has also been applied to Financial Wisdom Limited,” said CBA.
All customers who will be contacted in this process are also eligible to register for the Open Advice Review program which was announced by the Group on 3 July 2014.
