CBA hit dead for fees
Townsville A SERIES of Commonwealth Bank financial planners charged dead customers advice fees, one for over an entire decade after they died, the banking royal commission has heard.
Counsel assisting the commission Michael Hodge, QC, presented a compliance report from late 2015 revealing the sordid details in which planners from CBA subsidiary Count Financial profited for years from dead customers’ fees.
The behaviour saw three financial planners charge fees to the accounts of four deceased customers for years.
It is believed most of the advisers still work for the bank.
The worst case revealed a planner knew a client had died in January, 2004, but was still whacking their account for almost $ 1000 a year in fees until December, 2015.
When questioned about it the financial planner complained “he didn’t know what to do”.
“He had tried to contact the public trustee and had not heard back,” a Count Financial document said.
The suggested action against the planner from the bank was “possible warning to adviser”.
In another case a client died in 2007 but the planner only contacted the widow in 2013, after six years of taking fees. No action was taken against the planner.
Mr Hodge asked the bank’s director of Commonwealth Private, Marianne Perkovic, how many breaches would the document have to detect before the problem was considered systematic.
Ms Perkovic said that was decided by a different part of the bank.
The bank last night said it had remediated the cases and paid refunds with interest.
“We owe the families of our deceased customers a sincere apology, not only for the oversight and the length of time to resolve this but for what happened in the first place,” bank spokesman Danny John said.
The revelations follow from Ms Perkovic on Wednesday agreeing CBA’s systems were “hopeless” and that it “had no idea what was going on” as it ripped fees from customer accounts without giving the financial advice promised. A NURSE who was left without the family home after listening to Westpac retirement financial advice says she will work “until I’m in a Zimmer frame” and pleaded for customers to be aware of lies buried “deep down in their paperwork”, the finance royal commission heard.
And the finance sector royal commission also heard the financial planner, Krish Mahadevan, still works for the bank.
The commission heard the experience of nurse Jacqueline McDowall, ( pictured) who along with her truck driver husband went to Mr Mahadevan to realise their dream of buying a bed and breakfast to both live in and help fund their retirement.
The commission heard he recommended they use their collective $ 200,000 in super to form a self- managed fund to buy a property, with promises from the bank they could borrow up to $ 2 million.
After they sold the house in Narre Warren for $ 484,000 on his advice, he revealed the couple could not access the amount needed to carry out their plan.
A tearful Mrs McDowall pleaded for consumers to be cautious. “I don’t know if we’re ever going to be able to get into our own home again,” she said.
“My furniture is still in storage. I’m still renting. And I just want people out there to be very, very careful.”
“Deep down in their paperwork and the way they speak to you, it’s just they’re not truthful. And I will never, ever trust anybody again. For them to do that to their customers is absolutely and utterly disgusting.”
She said they had moved to the Northern Territory with the hope of better paying jobs to buy a house.
Mrs McDowall said she would now retire when she was “in a wheelchair or Zimmer frame”. JEFF WHALLEY