NAB’s Financial Advice Customer Response Initiative update
NAB has today provided an update on its financial advice Customer Response Initiative – a commitment made to improve transparency for Wealth advice customers.
Chief Customer Officer, Consumer Banking and Wealth Management, Andrew Hagger said that NAB started working on the Customer Response Initiative in February 2015 to improve the customer experience and to make sure that where problems are identified we fix them.
“We’re committed to helping restore customer trust and confidence in the financial planning industry. As part of this, last year we made a number of public commitments to strengthen our business and improve our transparency and openness. I’m pleased that we are continuing to meet those commitments,” Mr Hagger said.
Since February 2015, NAB has made $6.5 million in payments to 251 customers after resolving their claims for compensation. This uplift in payments to customers follows a significant investment by NAB into its capacity to investigate and resolve customer complaints[i].
“Our focus is to do the right thing by our customers. We believe the way that we have structured our work has helped to deliver more money into more customers’ hands as quickly as possible.
“I would like to thank Professor Dimity Kingsford Smith who has played an important role in the design of our Customer Response Initiative as our independent Customer Advocate. Professor Kingsford Smith is challenging our thinking and practices to ensure the interests of customers remain at the centre of the Customer Response Initiative.”
NAB’s public commitments made in 2015 and the current status for each commitment is provided below:
Our commitment: Where there is professional misconduct in wealth advice we will move to write to all customers, where misconduct has occurred in the last five years.
Current status: On 21 October 2015, we announced that we had started to write to customers as part of the Customer Response Initiative. We are writing to groups of customers where there is a concern that they may have received inappropriate advice since 2009.
Our commitment: We will respond to all new customer complaints within 45 days.
Current status: We have committed to responding to new complaints within 45 days, and we are tracking well against this commitment.
Our commitment: We are going to add independence into our complaints and whistleblower process.
Current status: In addition to appointing an independent officer to sit on our own whistleblower committee, we have introduced six different measures to increase independence into our complaints resolution. They are:
- appointing KPMG to help design the Customer Response Initiative
- appointing an independent Customer Advocate for wealth advice
- appointing Deloitte to review and report on our progress
- Deloitte’s reports to us will be provided to ASIC – the independent regulator
- offering customers $5000 to source their own additional independent financial advice if they need help understanding the outcomes of the CRI
- negotiating a streamlined review process by FOS if customers do not accept the outcome of the Customer Response Initiative.
Our commitment: We will advise ASIC of all advisers who leave, with the categorisations and reasons of their departure.
Current status: In addition to our reporting obligations for the ASIC financial adviser register, we have implemented a process to notify ASIC in writing of any adviser departures, where we have had compliance concerns about that adviser.
Our commitment: We committed to look to remove confidentiality orders from settlements and to write to customers to advise them these orders had been lifted.
Current status: While our previous confidentiality obligations did allow customers to talk to the media, ASIC or advocacy groups about the facts leading to their complaint with NAB, we acknowledge they were written in such a way where customers may not have been aware of this. So, as part of our Customer Response Initiative, to remove any ambiguity, we have started to write to appropriate customers to advise them that past confidentiality obligations have been lifted. Furthermore, these clauses are no longer included in NAB Wealth Advice Deeds.
In addition to our 2015 commitments, NAB is committed and progressing to the package of industry initiatives announced by the Australian Bankers’ Association (ABA), aimed at enhancing our customers’ experience with us, and reinforcing the banking sector’s standards of service, integrity, trust and ethics.
[i] When NAB last provided an update on its Customer Response Initiative in October 2015, we explained that since February 2015 to October 2015, NAB had made $1.7 million in payments to 87 customers after resolving their claims for compensation