Licensees wanted remediation ‘opt-in’ says ASIC

17 April 2018
| By Mike |
image
image
expand image

A number of financial services licensees have argued that clients should be made to “opt in” to the remediation process surrounding fee for no service, according to the Australian Securities and Investments Commission (ASIC).

In new information uncovered during yesterday’s public hearings of the Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry, ASIC deputy chairman, Peter Kell, said the regulator had faced resistance from licensees on the remediation issue including some firms wanting their clients to “opt-in”.

“So we’ve ended up having, at times, reasonably vigorous debates around the scope of the review and how many licensees should be included,” he said. “We had discussions with some firms who wanted to suggest that a remediation program where consumers had to actively opt in to get remediation was appropriate.”

Kell said this ran counter to ASIC’s view which was that, given the passive nature of many of the fees, “opt-in” would not be the right way to go.

The ASIC deputy chairman also pointed to some firms arguing about the length of remediation programs and “whether a mere offer to conduct an annual review to the client – even if that wasn’t taken up or the client couldn’t be contacted – whether that was sufficient to allow a fee to be charged”.

“All of those issues and more, frankly, have been, at times, in dispute,” Kell said.

 

Read more about:

AUTHOR

Recommended for you

sub-bgsidebar subscription

Never miss the latest news and developments in wealth management industry

MARKET INSIGHTS

GG

So shareholders lose a dividend plus have seen the erosion of value. Qantas decides to clawback remuneration from Alan ...

2 months 1 week ago
Denise Baker

This is why I left my last position. There was no interest in giving the client quality time, it was all about bumping ...

2 months 1 week ago
gonski

So the Hayne Royal Commission has left us with this. What a sad day for the financial planning industry. Clearly most ...

2 months 1 week ago

A Sydney-based financial adviser has been banned from providing financial services in the interest of consumer protection after failing to act on conduct concerns. ...

3 weeks 3 days ago

ASIC has cancelled the AFSL of a $250 million Sydney fund manager, one of two AFSL cancellations announced by the corporate regulator....

3 weeks 1 day ago

Having divested its advice business in August, AMP is undergoing restructuring in at least four other departments amid a cost simplification program....

2 weeks 5 days ago