Compensation review for negligent and fraudulent financial planning advice by the Commonwealth Bank continues under the supervision of ASIC – Licence Conditions Program extended. Senior Associate and Litigation lawyer Charles Lethbridge provides an update on the program.
Although it seems almost like yesterday that the Commonwealth Bank was engulfed in a financial planning advice scandal, the intervention of ASIC and the implementation of a compensation scheme was first set up in 2014. Revelations that dishonest in-house financial planners had provided inadequate advice to Commonwealth Bank customers (and in some cases acted fraudulently) led to the implementation of the Licence Conditions Program for customers who received in-house financial advice from Commonwealth Bank financial planning or Financial Wisdom between 1 September 2003 and 1 July 2012.
As part of the review process and the ongoing financial licence held by the Commonwealth Bank, it was required to review advice given to customers during this timeframe and write to them with an offer to pay up to $5,000.00 for the customer to obtain an independent opinion from an accountant, lawyer or licensed financial advisor. It was left to the bank through its internal processes to identify advisors who had provided negligent or fraudulent advice. This has led to delays and other problems with the program. It appears the Commonwealth Bank did not frankly assess the advice provided by its financial planners which led to customers not receiving any compensation or being told that, in the Bank’s opinion, the advice provided to them was adequate or appropriate in the circumstances.
Further scrutiny by independent accountants has uncovered more cases of shoddy advice being provided by financial planners and the failure of the bank to identify these issues and communicate with their customers under the Licence Conditions Program. There were also allegations that the bank had not acted quickly enough in relation to providing compensation to those customers who had suffered losses as a result of the negligent advice. This led to the extension of the program and further intervention by ASIC.
Attwood Marshall Lawyers have acted in a number of cases against the Commonwealth Bank and we are very familiar with the Licence Conditions Program. If you receive a letter from the Commonwealth Bank inviting you to participate in the program and obtain advice, please contact us as soon as possible so that we can review your matter and provide you with advice concerning recovery of your losses and the adequacy of the advice given to you.
The Commonwealth Bank has set up a process called the Open Advice Review (OAR) program to facilitate the review of the advice and, if appropriate, the payment of compensation to customers. The program is designed to deal with these matters without the need for litigation and avoid the costs and stress of going to court.
Attwood Marshall accepts these matters on the basis that the fee paid by the Commonwealth Bank is accepted in full and final satisfaction of all services rendered. This ensures that there are no additional costs to the Commonwealth Bank customers. If the matter proceeds further to recovery of losses suffered due to negligent financial planning advice from the bank, we continue with this claim under the OAR program on a “no win no fee” basis. Usually, the total amount of the legal costs are recovered from the Commonwealth Bank in a successful claim which results in no further out of pocket expenses to our clients.
If you have recently received a letter from the Commonwealth Bank inviting you to participate in the Licence Conditions Program or you are a customer that received financial planning advice between 1 September 2003 and 1 July 2012, please contact us and we will provide you with a no obligation free initial appointment with one of our experienced commercial litigation lawyers.
Attwood Marshall Lawyers regularly act for clients who have suffered damages as a result of the professional negligence of advisors including accountants, financial planners and banks.
If you would like more information or want to obtain the best possible chance of a successful outcome in your dispute, please contact our Commercial Litigation Department Manager, Amanda Heather on direct line 07 5506 8245, email aheather@attwoodmarshall.com.au or free call 1800 621 071.
We have an experienced dedicated Commercial Litigation team that practice exclusively in these areas.
