Tuesday, May 20, 2014

$7 million compensation paid to clients of Cairns financial planner

The Australian Securities & Investments Commission (ASIC) announced on Friday the imposition of licence conditions to force the Commonwealth Bank to reopen the compensation process related to inappropriate advice from two financial planning divisions. The Sydney Morning Herald / The Age (Fairfax) has reported that $7 million has to date been paid to clients of a Cairns financial planner: CBA told to reopen compensation for advice victims.
Commonwealth Bank has been forced to reopen its compensation process for victims of shoddy financial advice provided by two of its planning businesses.
More than 4000 customers of Commonwealth Financial Planning (CFPL) and Financial Wisdom will now be able to apply for compensation under new licence conditions imposed by corporate watchdog the Australian Securities and Investments Commission.
The decision comes after a joint Fairfax Media and Four Corners investigation into the two groups revealed that compensation payments to customers of planners in both divisions were not given the same treatment. 
ASIC has also admitted giving inaccurate testimony to a Senate inquiry into its performance over the financial planning scandal.
In a statement, ASIC blamed the bank for leading it to mislead the Senate, saying it sourced its information from CFPL's submission.
The CBA said that on Friday it gave the senate committee ''additional clarity on its submissions''.
The bank previously told the inquiry that compensation of $51 million was paid to victims but failed to make it clear that, in addition to CFPL customers, that number also included $7 million paid to customers of Financial Wisdom planner Rollo Sherriff.

This is quite significant action from ASIC and one would think the Cairns Post would report at least something of this as a matter of community interest, but apparently not? Previous reports by Fairfax:

Rollo Sherriff and Meridien Wealth: How a rock-solid institution backed impenitent maverick;
ASIC to feel heat over 'star' financial planner;
CBA facing $200 million class action;

Meridian Wealth in Cairns was also previously known as Irwin & Sherriff Investorcoach prior to 2005.

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