The Commonwealth Bank has announced an ‘open review program’ to investigate the advice failures at its financial planning arms.
In a statement issued earlier today, chief executive Ian Narev said the “far-reaching program of review” would demonstrate the bank’s commitment to remediation and have “no cost to customers”.
"Poor advice provided by some of our advisers between 2003 to 2012 caused financial loss and distress and I am truly sorry for that," he said.
"We know this is unacceptable and I unreservedly apologise to all customers affected."
The aim of the bank’s compensation program will be to “put customers back in the position they would have been had they received suitable advice” as well as addressing concerns raised during the Senate Committee’s inquiry.
The program will include a dedicated hotline for former clients and an opportunity for an assessment of any advice received during the relevant period.
This will be conducted by a “specialist Commonwealth Bank team” and followed with an audit by an “independent customer advocate” funded by the bank.
Aggrieved clients would still have the option of taking the matter to the Financial Ombudsman Service.
Mr Narev also said that the Commonwealth Bank had transformed its financial planning businesses, so they now provide quality advice and put customers first.
“There have been changes in management, structure and culture. We have also invested in new systems, implemented new processes, enhanced adviser supervision and improved training,” he said.
“However, I acknowledge there are views among some customers, and indeed in the Senate report released last week, that our approach has not been sufficient for all our customers. We have listened carefully and this program is a direct response to those concerns.”
[Related: Senate criticises ASIC handling of CBA]