In yet another scandal involving one of the Big Four banks, Westpac has been caught in a three year, $646 million campaign to convince super fund customers to move their money to a separate account. This was not in the best interests of the customers, according to a report from the Australian Securities and Investments Commission (ASIC) in December 2016.
The New Daily reports that the campaign was run over the phone, and spanned from 2013 to 2016. The bank staff who were a part of the operation were also found to have provided specific personal financial advice, which they are not authorised to do. The most they can do over the phone (if they are not a qualified financial adviser) is give general advice.
Bank staff who successfully convinced their customers to switch their super funds into one BT account were paid a commission, said Westpac CEO Brain Hartzer. This is another example of a big bank operating for its own interests regarding superannuation accounts, and not working in the interests of the customer.
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How did Westpac get away with their campaign?
"[Bank staff provided] personal advice to customers … regardless of the appropriateness of that advice to the customer."
The three year operation was carried out over the phone or by mail, and in 37 different targeted campaigns, almost one-third of the people in contact with the bank switched their funds. The New Daily reported ASIC's response:
"[Bank staff provided] personal advice to customers to roll over their external accounts into their BT account and did so regardless of the appropriateness of that advice to the customer, and with the primary purpose of generating [funds under management], thus preferring their own interests to those of their customers."
Contacting their customers over the phone or by mail meant that people believed the staff in touch with them could only be working in their best interests. They clearly were not, and for some customers, it might be time to say 'enough is enough'.
The Big Four are constantly caught up in one scandal or another regarding their poor conduct. Make the switch to a customer-owned bank like CAPE, and join the 4 million satisfied customers around Australia. Get in touch today for more information.