The Commonwealth Bank's compensation bill for victims of bad financial advice has risen to $29 million.
But customers who were knocked back from the scheme say it was flawed to begin with and have welcomed a push in the Senate for commission of inquiry into the banks.
CBA executive general manager Leif Gamertsfelder said the Open Advice Review program, which was set up by the bank in 2014 in the wake of scandals, had now reached its final stages.
"Reviews were completed and issued to customers early this year and the vast majority of cases – around 90 per cent – have now been finalised," he said.
But a final report into the scheme, by Promontory Financial Group, shows the majority of customers who expressed interest in having their case reviewed by the bank were knocked back because they failed to fill out a form in time.
The bank reviewed 8654 customers out of a total 22,792 who made expressions of interest in the scheme.
More than 11,000 customers were excluded from the program "on administrative grounds" because they failed to complete a form issued by the bank within a 12-month window.
A further 980 customers were removed from the program for not completing the form – even though they registered for the scheme before the form was a requirement.
Belinda Shenman lodged a claim with the compensation program in 2014.
She was told that her claim, which related to advice given in a CBA branch in Victoria, did not fit the criteria of the program and would not be reviewed.
"We fell outside what they wanted to deal with," she said.
"They were very strict about the guidelines for the program."
Until someone really forces a change, there will be many, many more victims.
The Senate on Thursday voted to set up a royal commission-like inquiry into banking, in a win for Labor, the Greens and the crossbench. It still needs to pass through the lower house to be established, with a vote likely on Monday.
Ms Shenman said an inquiry was the only way to get cases like hers genuinely assessed.
"Until someone really forces a change, there will be many, many more victims."
According to the review, only 14 per cent of customers received "poor or incorrectly implemented" advice. The overwhelming majority, 73 per cent, were given advice deemed "appropriate" by the bank.
The report comes a day before bank chiefs are due to front an inquiry into the Turnbull government's new bank levy on Friday. That bill will pass with support from Labor.This article was first published by https://www.theage.com.au/business
Author: Georgia Wilkins
stan vincent Friday, 15 February 2019 04:01 Comment Link
when commsec took over IWL/avcol in jan 2008 they suspended the phone trading line for 20 days.I lost $400000 because I could not exit the market till 23/1/08.I had been trading almost daily with avcol with the same personal contact for years.Report