ANZ signed ‘terrible’ adviser in fees grab

ANZ forked out hand over fist to sign up financial advisers from a failing company under investigation by the corporate watchdog, the banking royal commission has heard.

The bank desperately wanted to secure the super-sized commissions the advisers received on hundreds of millions of dollars in clients’ funds under management, the commission heard yesterday.

As a result of its recruitment drive, it signed up adviser John Doyle — and would ultimately have to compensate customers for the damage caused to their finances.

ANZ offered Mr Doyle up to $150,000 to bring his business across from the Australian Financial Services platform, which was being shut down by regulators.

Through his company Carrington Financial, Mr Doyle had 700 clients with about $60 million invested through Australian Financial Services.

Counsel assisting the commission Rowena Orr, QC, revealed yesterday that Mr Doyle signed up for ANZ subsidiary RI Advice in 2013.

ANZ head of aligned dealers groups and advice standards Darren Whereat said yesterday: “It was being closed down — there was competitive pressure to acquire some of the clients.”

Ms Orr said the bank want- ed to ensure it held on to about $670 million of funds under management handled by Australian Financial Services. That meant the bank would get valuable trailing commissions and fees.

ANZ heard that in August 2013, months after it secured Mr Doyle’s business, a customer complained about him after being overcharged more than a thousand dollars.

“A flag like this is an early indicator [of a problem],” Mr Whereat agreed yesterday.

The commission heard Mr Doyle was a terrible adviser who constantly failed exams testing his skills, and was flagged in audits as a poor performer.

Mr Whereat wrote to Mr Doyle’s company in June, 2015, saying RI was terminating any business with Mr Doyle’s company within six months.

It allowed him to continue dealing with his existing 700 clients. The commission heard Mr Doyle continued to give clients inappropriate advice in that time.

“I accept that was a mistake ... It was unacceptable,” Mr Whereat said.