ANZ has warned its financial advisers that they will be terminated if they fail two audits and has removed all sales incentives related to financial advice.
The moves were announced by the bank as part of a series of initiatives aimed at improving the quality of its financial advice and ensuring faster customer remediation after poor or inappropriate advice.
Under the initiatives, ANZ has removed sales incentives and will only assess adviser performance on customers satisfaction and adherence with ANZ values and risk and compliance standards.
ANZ will also move to identify advisers providing inappropriate advice, introducing the new audit pass rate and termination policy, and will offer ANZ advice customers a free review if they have any concerns about their current financial position.
“Financial advice is an important part of the services we offer, but it’s also an area where we’ve failed some of our customers”.
Additionally, any new advisers hired will be required to hold a relevant under graduate degree and industry certification and existing advisers will need to be enrolled in further necessary training by January 2019.
ASIC recently accepted an enforceable undertaking from ANZ in relation to more than 10,000 customers being charged for advice they did not receive (see: ANZ Receives EU Over Fees For No Service) and, as part of the new initiative, ANZ committed to completing compensation on about 9,000 current inappropriate advice cases by the end of the year.
ANZ Chief Executive, Shayne Elliott said, “Financial advice is an important part of the services we offer, but it’s also an area where we’ve failed some of our customers”.
“We know it has taken too long for changes to occur, so where we see solutions we will act. That’s why we are getting on with these initiatives now,” he said.
ANZ confirmed to Riskinfo that the new initiatives will only apply to around 300 advisers within the bank’s aligned, branch-based ANZ Financial Planning licence and not to its other advice businesses: Millennium3, RI Advice, Elders Financial Planning and Financial Services Partners, which are being transitioned to IOOF after they were sold in October 2017 (see: ANZ Wealth to Keep Insurance on the Table).
Of course this is the ANZ response Its all the advisers fault and they must be punished. What about banning performance incentives for the executives whose watch this happened on – I know for a fact that for over a decade it was the ANZ model of fee for no review with the only clients to get reviewed being those that could be churned – not just the decision of advisers. I know many advisers that left ANZ 5,10,15, 20 years ago because they knew the ANZ model was not sustainable. Management is pathetic, they created the problem and still know accountability. What will the quality of adviser be if they pay peanuts. ANZ continue to have no idea.
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