Commonwealth Bank of Australia (CBA) has agreed to pay A$3m ($2.3m) to resolve allegations of charging customers for annual reviews they did not provide.
The move follows a probe by the Australian Securities and Investments Commission (ASIC), which revealed that the bank’s financial planning subsidiaries Commonwealth Financial Planning and BW Financial Advice failed to provide or offer evidence of annual reviews to around 31,500 Ongoing Service customers between 2007 and 2015.
The probe also revealed that the subsidiaries lacked adequate systems and processes to ensure whether reviews were being provided to their customers.
CBA detected the failures and self-reported them to ASIC in 2014. The two subsidiaries have now agreed to an enforced undertaking, under which it has appointed EY to independently assess its processes.
CBA CEO Matt Comyn said: “We recognise the fact that we have failed customers in our advice businesses over the past decade. These failures have resulted in a range of regulatory actions including imposition of licence conditions and remediation programmes. This is unacceptable and we owe our customers an apology for letting them down. Providing quality financial advice is critical for our customers.”
The latest move comes shortly after ANZ was fined A$3m on similar grounds.