(Reuters) – Commonwealth Bank of Australia on Tuesday announced moves to improve its wealth management business, which has come under fire from a high-profile inquiry on the financial sector that revealed unauthorized fees.
A view of a Commonwealth Bank of Australia branch in Sydney, Australia, April 18, 2018. REUTERS/Edgar Su
The country’s No. 1 lender will remove certain fees on legacy wealth products and will launch a program to refund any unauthorized advice fees charged to deceased estates, among other initiatives.
It will also rebate all grandfathered commissions to Commonwealth Financial Planning customers from January 2019, CBA said in a statement.
“The changes announced today continue the process of reform underway in our wealth management businesses and form part of our response to specific issues identified this year through the Royal Commission,” CBA Wealth Management Chief Operating Officer Michael Venter said.
CBA charged some estates of dead people for superannuation advice and had inadequate compliance controls in its management of retirement funds, the Royal Commission, as the inquiry is called, heard last month.
“Work is ongoing, however an initial search of 142,000 accounts identified 12 deceased estates being charged unauthorized advice fees between April and June 2018,” Venter added.
Australia’s “big four” banks have been trying to shore up their reputations as they grapple with fallout from the inquiry.
On Monday, Australia and New Zealand Banking Group Ltd said it would take a A$711 million ($501 million) hit due to higher costs, including compensation for customers stung by poor bank practices.
Reporting by Aditya Soni in Bengaluru; Editing by Dan Grebler