Senate Committee recommends royal commission
The Senate Committee reviewing the performance of the Australian Securities and Investments Commission (ASIC) has recommended a royal commission be instigated into the events which led to an enforceable undertaking entered into by Commonwealth Financial Planning.
The committee has also recommended that responsibility for compensation arrangements be taken away from the Commonwealth Bank.
At the same time ASIC has been directly criticised by the chairman of the Senate Committee reviewing its performance.
Senator Mark Bishop, handing down the report of the Senate Economics References Committee, described ASIC as having been "lulled into complacency" and as having paid too little attention to whistle-blowers within Commonwealth Financial Planning.
He said the committee is of the view that the CBA played down the seriousness of the problems within CommFP in an effort to limit compensation payments.
"This highlights how trusting the regulator is of big business," Senator Bishop.
It is only since May this year that ASIC has begun to understand how the compensation schemes work.
"It is essential that all rogue advisers be identified and all breaches be pursued and that all affected clients receive just compensation and the current compensation arrangements are inadequate," he said.
"To my mind responsibility for the compensation arrangements should be taken away from the bank," Senator Bishop said.
Money Management’s coverage of the Senate Committee report into the performance of ASIC:
Bushby issues dissenting report
CBA refutes senator's deflection claims
ASIC should face regular reviews
Senate report calls for adviser banning powers and increased penalties
Report calls for higher education standards and enshrinement
Expect ASIC to be more rigorous
AUTHOR
Staff Writer
Recommended for you
Financial advisers and wealth managers need to exceed their clients’ desires for personalisation, a new EY report writes, and the requirements for this will vary between client segments.
Betashares chief executive, Alex Vynokur, believes technology advancements will enable banks to return to financial advice in the future as the need for advice is greater than ever.
Centrepoint Alliance has upgraded its expected financial results for FY24, thanks to strong adviser recruitment and the acquisition of Queensland advice firm Financial Advice Matters.
The corporate regulator has permanently banned a Melbourne-based financial adviser that “dishonestly attempted to induce clients to transfer their superannuation into a bank account he controlled”.
