Who gets CBA compensation?

The CBA will provide compensation for those who received the wrong advice.

The announcement by the Commonwealth Bank of Australia (CBA) that it will provide more compensation, for those who have lost money by following financial advice given by its planners, may have you asking if you’re entitled to make a claim. The good news is that anyone who received advice from 1 September 2003 to 1 July 2012 can ask for compensation, the bad news is that it’s up to the CBA whether you get it or not.

To receive compensation, you will have to establish that the advice you received was wrong for your risk profile. You can’t get compensation just because you lost money or your investments didn’t perform as well as you thought they would. And, if it’s deemed that you should receive compensation, the amount of money you get back may not be much. You will only receive the difference between what your investments returned and what the investments would have returned if you had been given advice for the correct risk profile.

Some 400,000 clients, past and present, are thought to be entitled to compensation and even if you have already received some form of resolution from the CBA, you can reapply if you think the payment you received was inadequate.

While the CBA is initially responsible for processing your claim, if you do not agree with its assessment, you can have it looked at by an independent review panel. The decision by the panel will be binding on the CBA, but not on the client, who can opt to take the dispute to the banking ombudsman or pursue it further through legal channels.

And for those lucky enough to have made money even though the advice given was incorrect? Well, they’re entitled to keep it.

If you think you may be entitled to compensation, visit Commbank.com.au for more details on how to start your review.





    COMMENTS

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    Kopernicus
    14th Jul 2014
    10:02am
    Unlike in the case of the Unions, there is no Royal Commission to be held into the machinations of the banks who set up a cabal of of financial planners acting primarily in self and the banks' interest. When exposed, they were dragged kicking and screaming to make an admission of nefarious and unconscionable practice 2 years later. They, not some other independent body, will now determine compensation. Pathetic still!

    There is also an ongoing pretense among the banks and this Big End of Town Govt that this practice was confined to CBA and nothing else needs done. ATSIC was very underdone in this matter and the govt further weakened them by funding cuts to make sure they are even weaker. The intention by this Govt to change the laws brought in to introduce integrity of financial planning practice seems unabated. Whose side are they on? Obviously not the man/woman on the street.
    Adrianus
    14th Jul 2014
    11:56am
    Kopernicus, do you honestly believe the laws aren't adequate? Greedy people will always find a way to ignore laws and that includes investors, advisors and whoever else. My question still remains. Why did ASIC do nothing when made aware? Why did Wayne Swan not act?
    Kopernicus
    14th Jul 2014
    3:10pm
    Thanks for the correction Frank, it is ASIC.
    Adrianus
    14th Jul 2014
    3:24pm
    Oh, I was kind of wondering what interest ATSIC specifically had. he he he
    Not Senile Yet!
    14th Jul 2014
    12:25pm
    This is the Classic Case of Labelling without proper thought as to how this was allowed!
    No one sees that people of power within the banks rorted their positions to create this situation and the Financial Advisers were turned into Glorified Salespeople who could earn big commissions!
    Then the Banks themselves were making such a killing that they did not want the tap of revenue turned OFF!
    Pigs at the Trough...was the label used when this happened in the USA.....when their unregulated private banks did the same!!
    However this is bigger than just Corruption within the Banking sector....why?....Because the Liberal Party Puppet Mr.T.Abbot has now declared that they want all restrictions that prevent this from happening within the Whole Financial Industry...REMOVED!!!!!
    This means they approve of this type of RORT!
    Yep...legal robbery is the way to go.....the American Big Business Way to Go!
    Welcome to the NEW AGE .....rob a bank...10-15yrs jail!
    Rob an Investor through bad/corrupt advice.....Big Fat Bonuses...and a slap on the back!
    Vote these idiots out of OUR Parliament!!!!
    NO MORE VOTES FOR THE PARTY MACHINES!!!!
    Vote Independent.......Next Election.....or for Every Election!!!
    Adrianus
    14th Jul 2014
    12:32pm
    "This is the Classic Case of Labelling without proper thought as to how this was allowed!"

    Perhaps you could let us know what happened and how it was allowed?
    professori_au
    14th Jul 2014
    12:30pm
    grhh! Lost my comment. I am pleased for all of those people who will receive some form of compensation. Whether it will be a fair level or whether it will be protected by the government who may impose a limit we will not know until it is paid. However, that is only part of the problems of how this bank operates. I have personal experience. I had a registered company, which was not operating. A person opened an account in the name of the company and it cost me a lot of money when this person fled owing a lot of money.
    I asked the bank why they had not done a company search and asked for a director's authority to open an account. The baqnk had done non of this. I then said they had a responsibility to advise me of what was going on. My bank manager said she thought the bank might be responsible and contacted their head office. Bank's response? what doe he want? An apology; an investigation and or compensation?.. I replied all of that. I was contacted by a lawyer from the bank's legal department and I was advised they would contact me when the investigation was complete. Eighteen months later I had not heard from them, so asked my local manager would she check as to the status.
    I received a callfrm a r demanding "how dare I ask a manager to make inquiries. I replied I had an account there and therefore I was entitle to ask my manager to make inquiries on my behalf. I then asked what progress had been made into the investigation. There was none. the excuse as that they were waiting for my out of pocket expenses. That had never been requested. I stated this was nonsense as it was a totally separate issue and had nothing to do with the investigations. I said it was belief, en his attitude, the bank had no intention of investigating. Waiting 18 months alone would not ensure that if the person was caught there would be any money let. I would lodge a complaint with ACCC. I did this and following an interview I was advised the bank appeared to have breached several areas as well as failing its duty of care and to carry out due diligence. I asked how long before ACCC would be able to investigate. He told me that there was a long waiting list and he could not advise. My reply was, given my age, would they please record on my file that when the investigation was complete, to knock on my coffin and let me know. At my age (mid seventies then) every year was a bonus. Unfortunately I do not have faith in the system to get me justice. What nest egg I had is gone and I now rely just on the pension.
    Kopernicus
    14th Jul 2014
    3:09pm
    Professori, why does this not surprise me. Abut 15 yrs ago my mother in law who was in her 80's and living alone got ripped by a couple who stole her bankbook and made a big withdrawal. She was a customer for ~40 years, never took big money out or used a proxy. Her signature in the bankbook was not checked. I pursued the matter on her behalf. The bank requested I show authority - pity such vigilance was not exercised initially I suggested. They stalled till a friend of mine, a barrister, wrote a threatening letter. They coughed up soon after.
    Tom Tank
    14th Jul 2014
    2:11pm
    It would appear obvious, to me and most people, that the laws covering this were not adequate and now that the strengthening that was carried out to protect consumers is being wound back.
    This whole business stinks of corruption and now our government are being party to it by encouraging the actions that caused such financial losses to trusting people. In my book betraying a trust in this manner is at least as bad as robbery with menaces.
    It appears that ATSIC is both woefully underfunded plus errs on the side of the BIg End of Town.

    14th Jul 2014
    2:26pm
    Has there ever been a BANK known that cared for the interest of customers, rather than their own 'interest' they got from customers investing their money through the bank.... does the Sun rise in the West ?.......lol
    Adrianus
    14th Jul 2014
    2:37pm
    These demutualised life companies have centuries of culture not easily reshaped over a couple of decades. Who thought it was a good idea that they merge with banks?
    Adrianus
    16th Jul 2014
    9:26am
    Don't be too hard on banks. The goal posts keep moving.
    The deregulation of the financial sector may have started at a slow pace in the 70's but definitely picked up pace in the 90's. I don't think this was a bad move by the ALP government, but it was always going to have some problems bedding down, particularly as it allowed Australia to adopt the idea of bancassurance. The concept was a little like letting the fox into the hen house. During the 90's we saw AMP sign an agreement with WBC which lasted 4 years before AMP pulled out of the deal because they couldn't gain unfettered access to customers and their deposits. ANZ seemed to have organised a cosy deal with foreign owned ING. Meanwhile down the road Colonial First State who had a recent name change from Colonial Mutual Life was penning a deal with the recently part privatised CBA. You know the rest. If only ALP leaders didn't want to leave a legacy. We always pay the price in the end.