Will planning execs face prosecution?

4 February 2019

Will the final report of the Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry recommend consideration of criminal charges against senior executives who were, or still are, operating in the financial planning industry?

That is a major focus for banking and financial services organisations today as they await the release of the final report which was delivered to the Treasurer, Josh Frydenberg on Friday by Commissioner Kenneth Hayne.

The concern around the possibility of criminal charges emanating from the commission centre on fee for no service and Hayne’s analysis in his interim report that companies, including AMP Limited and the Commonwealth Bank, had “acted inconsistent with the law” and specifically with the key sections of the Corporations Act.

Related News:

However even if Commissioner Hayne makes recommendations with respect to particular companies or individuals it will be up to the regulators and the Director of Public Prosecutions (DPP) whether legal action is initiated although the Australian Prudential Regulation Authority (APRA) has already moved against IOOF Limited.

Beyond the possibility of the Royal Commission acting as a catalyst for the initiation of legal action against individuals and companies, the focus for many financial advisers will be the future of grandfathered commissions.

The Association of Financial Advisers (AFA) last week warned its members to brace for adverse outcomes from the commission, including the changes to the licensing regime and vertical integration, the banning of grandfathered commissions and further restrictions on life insurance commissions.

It also warned of the possibility of constraints being applied to clients paying for ongoing advice from superannuation accounts.

What actually happens with respect to the recommendations contained in Hayne’s final report will be at the discretion of whichever Government wins power at the forthcoming Federal Election, but both the Coalition and the Australian Labor Party have signalled their intention to act on the findings.

The final report of the Royal Commission will be made public at 4.30pm this afternoon – the close of business on the Australian Securities Exchange (ASX).


Recommended for you




James Gibbs stole 5 million from clients and faces decades in jail. Fair enough.

CBA, NAB, BT, ANZ and expecially AMP stole billions from customers, rigged exchange rates, pressured doctors to change their medical diagnosis, ruined lives. They ruined our industry and have also ruined the lives of so many well meaning financial advisers (both their employees who were blamed for everything and independents who have to adhear current legislation, FASEA, FOFA, LIF etc).

The directors and senior executives must be held accountable. Fines do not work. Their executive team MUST FACE LONG JAIL TERMS. Fine them directly too. Take their Toorak mansions and their kids Mazeratis.

Two sets of rules - one for the individual and the other for the elite that are above the law

Add new comment