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FBAA slams major bank for ‘dodgy’ practices

by Huntley Mitchell7 minute read
The Adviser

The FBAA says pressure on staff at a big four bank to sell unsuitable finance products to customers in order to meet performance targets is hurting the industry’s integrity.

According to Fairfax, a recent report by the Finance Sector Union revealed that CBA staff “have raised concerns that performance targets are pushing employees to sell financial products that are not in the customers best interests”.

The FBAA’s Peter White said this was another example of the way banks and major lenders operated, stopping at nothing to ensure they improved their financial bottom line.

“This might be great for shareholders, but comes at the expense of customers who are being offered loans that are unsuitable and unsustainable,” Mr White said.

“The Financial Services Union has got it right in condemning this ‘sales culture’ within the banks. In fact, it is this type of practice that provides ammunition to those pressing for a royal commission into the banking industry.

Mr White’s comments came after he said last week that NAB’s use of “tip-offs” from credit scoring agency Veda to track customers going to rival banks for a loan created serious privacy concerns around the sharing of information.

“It is important brokers get the message across that customers have every right to refinance or apply for a new loan without having a bank accessing personal information which they have no right doing.”

[Related: FBAA defends brokers against negative media coverage]



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