January 9, 2018
Aligned advice groups have returned more than $180 million in financial advice fees that were collected without the provision of advice, according to data released by ASIC in December.
The money has been repaid by AMP, ANZ, CBA, NAB and Westpac after ASIC found the advice divisions of the five organisations had been charging for advice when none had been provided (see: Aligned Advice Groups to Pay Millions in ‘Fee For No Service’ Refunds).
The level of repayments, based on data reported by the institutions to ASIC as at 31 October 2017, is three times higher than the last time similar data was released, in April 2017. At that time, only $60.7 million of an estimated $170 million had been repaid to consumers (see: Aligned Advice Groups to Pay More for Non-existent Advice).
Since that time, however, the level of compensation has also climbed to $183.6 million, with $3.5 million yet to be paid to consumers, according to the regulator.
The increase in the level of compensation payments is the result of the Commonwealth Bank returning $112 million to consumers since April 2017, at which time it had only paid $5.8 million of an estimated $105.6 million.
ASIC will release a further update on the levels of compensation payments in mid 2018.
Compensation Payments as Reported to ASIC as at 31 October 2017
|Group||Compensation Paid or Offered||Estimated Future Compensation||Total Estimate of Compensation|
|AMP||$4,715,188||Not yet available||$4,715,188|
|Westpac||$3,113,159||Not yet available||$3,113,159|