NAB Chief Customer Officer, Consumer Banking and Wealth, Andrew Hagger, today said the Financial advice: identification and response to non-compliant advice in financial institutions report released by ASIC demonstrated the importance of the on-going commitments NAB has made to improving outcomes for customers.
This includes NAB’s Customer Response Initiative, which NAB designed to be industry leading in reviewing past advice and compensating affected customers.
As ASIC notes in its report, as at 31 December 2016, NAB has paid approximately 115 customers $2.3 million to resolve complaints, or to compensate for non-compliant advice by 24 financial advisers for the period 1 Jan 2009 and 30 June 2015. This represents less than 0.01 per cent of NAB’s approximately 1.5 million financial advice customers, and 0.6 per cent of our financial adviser workforce.
Mr Hagger said that in mid-2013, NAB started broadly reviewing its wealth business, with a focus on significantly lifting standards, finding and fixing issues, and improving culture and performance.
“NAB’s wealth business was very complex in 2013 following a number of acquisitions and significant regulatory change, including Future of Financial Advice (FoFA) reforms and Stronger Super,” Mr Hagger said.
“Our goal was to methodically and transparently focus on both the culture and performance of NAB’s wealth business, as well as driving change on those fronts from an industry perspective. This included actively looking for issues, making them right for customers and then improving systems and controls to prevent those issues from recurring.
“Amongst a range of reviews and improvements implemented across our wealth business, we commissioned an in-depth look into our wealth advice business, where we identified concerns with the conduct of a small number of advisers.
“In February 2015, we announced the Customer Response Initiative for wealth advice. We designed the Customer Response Initiative to be industry leading. We have deliberately focused the initial work of Customer Response Initiative towards the most complex customer cases, and for those customers most in need.
“I’d like thank our Wealth Customer Advocate, Professor Dimity Kingsford-Smith, who has challenged our thinking and practices as we designed the Customer Response Initiative.
“Our focus on improving standards and performance is on-going and we might continue to find issues – because that’s what you do when you constantly look to raise the bar for customers. When we do find issues, we will say sorry to customers and make things right.”
Mr Hagger noted that since ASIC began this project in 2015, NAB has made a number of changes across its wealth advice business – including its adviser audit practices – and continues to make improvements. While ASIC has not yet shared with us any findings that relate to NAB individually, we welcome any discussions the regulator wants to prioritise that will benefit our customers.
NAB further confirmed that all of its advice licensees support and have subscribed to the ABA reference checking and information sharing protocol, and would like to see all licensees operating under it.
“At NAB, we believe in the value of financial advice for Australians. We have long been leaders in doing the right thing by our customers, including leading the industry in implementing ‘fee for service’ financial advice in 2009, well ahead of FoFA reforms,” Mr Hagger said.