ASIC delivers final advice misconduct update

In what is expected to be its final update on the program, the Australian Securities and Investments Commission (ASIC) has outlined the latest information on the compensation paid to customers related to financial advice misconduct.

As of 31 December 2022, AMP, ANZ, CBA, Macquarie, NAB and Westpac have paid or offered a total of $4.7 billion in compensation to customers after it was found they failed “to ensure provision of ongoing advice services to customers who paid fees to receive those services (fees for no service)”, advisers failed “to provide those services” and the providers failed to “switch off advice fees of customers who did not have a financial adviser”.

“While this final update on remediation figures draws a line under this program of work – following 8 years of addressing financial institutions’ and advisers’ failure to provide ongoing services to fee paying customers – we will continue to monitor institutions’ processes to complete ongoing work in this area,” Commissioner Danielle Press said.

“ASIC compensation for financial advice related misconduct project has shone a light on the advice fees that customers are paying and the services they should be receiving in return.

“The subsequent programs have resulted in very significant remediation payments to affected consumers.”

Out of the six product issuers in question, NAB has offered or paid the most total compensation with close to $1.5 billion for just over 800,000 customers, with CBA following close behind at $1.1 billion to over 250,000 people.

Westpac has provided over $1 billion to just over 120,000 customers, AMP $679 million to over 340,000 people, and Macquarie rounds up the bunch with only $4.6 million to 1,105 customers.