{"id":28770,"date":"2015-02-24T11:08:36","date_gmt":"2015-02-24T00:08:36","guid":{"rendered":"https:\/\/riskinfo.com.au\/news\/?p=28770"},"modified":"2015-03-11T07:01:57","modified_gmt":"2015-03-10T20:01:57","slug":"new-advice-scandal-rocks-sector","status":"publish","type":"post","link":"https:\/\/riskinfo.com.au\/news\/2015\/02\/24\/new-advice-scandal-rocks-sector\/","title":{"rendered":"New Advice Scandal Hits Sector"},"content":{"rendered":"

The financial advice market has been hit with yet another scandal following an admission from NAB Wealth that it has paid more than $10 million in compensation to customers who received inappropriate advice from its aligned advisers.<\/span><\/p>\n

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\"NAB<\/a>
NAB Head of Wealth, Andrew Hagger<\/figcaption><\/figure>\n

In a statement issued in response to Fairfax Media reports released over the weekend, NAB Head of Wealth, Andrew Hagger<\/strong>, confirmed that NAB had compensated over 750 customers during the past five years. He also stated that NAB had commissioned a review of its Wealth business, following the release of the Senate Economics References Committee report into the handling of the CBA advice scandal (see: CFPL Scandal a Lesson for Entire Industry<\/a>).<\/p>\n

\u201cWhen we identify or are made aware of issues we will always work to fix them. We perform regular audits and where we see problems we will highlight them because we want to fix them,\u201d Mr Hagger said.<\/p>\n

\u201cWe were transparent with this information, with our senior management team, the NAB Principal Board and our regulators,\u201d he added.<\/p>\n

Among the issues alleged to have occurred within the NAB advice network are instances of inappropriate replacement insurance advice. In its August 2014 review of life insurance advice, the Australian Securities and Investments Commission (ASIC) said it had identified numerous cases where clients were encouraged to switch insurance policies with little evidence that such a switch was in their best interests. ASIC said it could not comment on whether NAB advisers were included in its review.<\/p>\n

ASIC will expand its regulatory work on NAB’s financial planning and wealth management businesses<\/h6>\n

\u201cIn response to ongoing problems in the financial advice sector, last year ASIC set up a specialist Wealth Management Project to focus on the conduct of the large advice entities (the four major banks, Macquarie and AMP). We have significant work underway targeting those entities. This includes work that covers NAB Wealth’s business. We cannot comment further on this work at this point in time,\u201d a spokesperson for ASIC told riskinfo this week.<\/p>\n

\u201cASIC will expand its regulatory work on NAB’s financial planning and wealth management businesses to consider any additional issues that are brought to its attention, and we urge Fairfax Media to share with ASIC any material it has, which might be relevant to our work involving NAB Wealth,\u201d the regulator said.<\/p>\n

For more on this issue, see:<\/p>\n