ANZ confirms further financial planning failures

In a brief media announcement, ANZ yesterday confirmed it would be "reimbursing some Prime Access clients after it identified the documented annual review, part of a package of services, had not been provided."

Prime Access is a fee-for-service package introduced in 2003 which includes priority access to financial planners, investment monitoring alerts and a documented annual review.

ANZ stated that it had acted "in accordance with its obligations under the Corporations Act", and reported the issue to the Australian Securities and Investments Commission.

For its part, ASIC also stated yesterday that it was investigating multiple instances of licensees charging clients for financial advice, including annual advice reviews, where the advice was not provided.

Deputy Chairman, Peter Kell said: "ASIC will consider all regulatory options, including enforcement action, where we find evidence of breaches of the law relating to fees being charged where no advice service has been provided. We will look to ensure that advice licensees follow a proper process of customer remediation and reimbursement of fees where such breaches have occurred."

The ASIC Wealth Management Project was established in October last year with the objective of lifting standards in major financial advice providers. Under this project ASIC is carrying a number of investigations and is conducting a range of proactive risk-based surveillances with particular focus on compliance in large financial institutions.

A timeline attached to ANZ's announcement shows ASIC was told about the breaches "in accordance with ANZ's obligations under the Corporations Act in August 2013." The bank also said it had "commenced a remediation program supported by external consultants PwC and law firm Clayton Utz" at that time.

In its media release, ANZ estimated the cost of reimbursing around 8,500 clients who did not receive a documented annual review to be approximately A$30 million. The bank said it was working with ASIC to finalise the refund methodology and payments would commence "as soon as the methodology is agreed."

Echoing the comments made to The Age by one of her ANZ Bank colleagues back in mid-2014, the bank's global wealth boss, Joyce Phillips, said: "We sincerely apologise to our clients for not delivering all of the Prime Access services we promised and we will reimburse affected clients as soon as possible.

"We have also put in place a range of measures to ensure this issue does not happen again. This includes improved training, technology, audit and supervision as well as including the documented annual review as an essential component of balanced scorecards for our financial planners," Phillips said.

ANZ confirmed that all Prime Access annual reviews and documentation due since 2013 had been delivered to its clients.