View more on these topics

Australian banking execs could go to jail after advice inquiry, ex-regulator says

Jail bankerFormer executives at Australia’s largest banks are likely to be sent to jail as the fallout from the country’s Royal Commission gathers pace, according to a former competition regulator.

Earlier this week one of Australia’s biggest banks, Westpac, said it is expecting to cut 900 full-time advice roles as it prepares to drop its loss-making financial planning business.

This followed the nation’s 14-month long Royal Commission into misconduct in the banking, superannuation and financial services industry.

The bank said that the move “reflects the changing external environment, including a trend by financial advisers to operate independently, or in smaller advisory groups”.

It was also reported last week that the nation’s second largest bank, National Australia Bank, would turn off “grandfathered commissions” for advisers as part of its remediation process.

Speaking to Money Marketing, former competition regulator Calvert Duffy says the fallout from the commission is still being worked out in the financial services industry.

He says: “Senior former executives are likely to go to jail, and I am pleased to say Hayne [Kenneth Madison Hayne who led the commission] has said there should be no more legislation. He understands passing new rules does not mean people behave better.

“One of the things that will probably change is that certain provisions of good practice codes will become enforceable. There is currently a Treasury consultation open until the 12 April. In terms of how our experience can be applied to UK, we can see that pots, which are fairly small compared to Australia, will grow.

“There’s a danger people in the UK could become complacent, believe all is well and do not check under the bonnet to see if anything is wrong.

“That is what happened in Australia as new legislation was passed and codes of conduct published but there was no focus on complying with the principle of the law, which is to do no harm.”

Recommended

1

900 advisers let go as major Australian bank exits market

One of Australia’s biggest banks, Westpac, is expecting to cut 900 full-time roles as it prepares to drop its loss-making financial advice business. This follows the nation’s 14-month long Royal Commission into misconduct in the banking, superannuation and financial services industry. Melbourne-based Viridian Advisory has struck a deal with Westpac for an undisclosed sum which […]

Australia-OZ-Sydney-Opera-House-700x450.jpg
1

Australian bank turns off advice commissions after govt inquiry

National Australia Bank has said it will turn off “grandfathered commissions” for its advisers as the country’s Royal Commission into the banking sector continues to reverberate. In a letter today, NAB says it has agreed to all 10 of the Royal Commission’s recommendations for financial advice. So called grandfathered commissions – trail remuneration on legacy […]

How sustainable income levels can protect portfolio strength

Taking a sustainable level of income is important in helping drawdown customers maintain a resilient portfolio during periods of investment volatility. Customers in income drawdown should think about the impact of volatility on their pension. While someone building up a pension can mitigate the effect of market falls by continuing to make contributions to their […]

Newsletter

News and expert analysis straight to your inbox

Sign up

Comments

    Leave a comment

    Close

    Why register with Money Marketing ?

    Providing trusted insight for professional advisers.  Since 1985 Money Marketing has helped promote and analyse the financial adviser community in the UK and continues to be the trusted industry brand for independent insight and advice.

    News & analysis delivered directly to your inbox
    Register today to receive our range of news alerts including daily and weekly briefings

    Money Marketing Events
    Be the first to hear about our industry leading conferences, awards, roundtables and more.

    Research and insight
    Take part in and see the results of Money Marketing's flagship investigations into industry trends.

    Have your say
    Only registered users can post comments. As the voice of the adviser community, our content generates robust debate. Sign up today and make your voice heard.

    Register now

    Having problems?

    Contact us on +44 (0)20 7292 3712

    Lines are open Monday to Friday 9:00am -5.00pm

    Email: customerservices@moneymarketing.com