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19-134MR Commonwealth Financial Planning completes compliance with ASIC Court Enforceable Undertaking
Commonwealth Financial Planning (CFPL) has complied with the Court Enforceable Undertaking (CEU) entered into with ASIC in April 2018 regarding CFPL’s fees for no service conduct.
On 30 May 2019, ASIC received:
- an attestation from Commonwealth Financial Planning Limited (CFPL) signed by Mr Angus Sullivan, Group Executive Retail Banking Services;
- a final independent expert report from Ernst & Young (EY).
ASIC is satisfied with the attestation provided by CFPL and the final independent expert report provided by EY and compliance with the obligations under the CEU is now finalised, save for the payment of some remaining refunds due to clients which is to be done by 30 September 2019.
CFPL has attested to the following matters as required under the CEU:
- the material changes to CFPL’s systems, controls and processes that have been implemented in response to the fees for no service conduct;
- that CFPL has taken reasonable steps to identify and remediate customers to whom CFPL did not provide annual reviews in the period from July 2015 to January 2018, on the basis that payment of additional refunds will be complete by the end of August 2019; and
- that CFPL’s systems, processes and controls are now reasonably adequate totrack and discharge CFPL’s contractual obligations to its ongoing service customers.
In January 2019, CFPL was required under the CEU to immediately take all necessary steps to stop charging or receiving ongoing service fees, and not enter into any new ongoing service arrangements with customers (19-018MR).
CFPL had completed those necessary steps by April 2019 and it will also compensate those customers who were charged fees during the period February to April 2019, with refunds and reconciliations to be completed by 30 September 2019. CFPL has also confirmed with ASIC that it does not intend to resume charging upfront ongoing service fees going forward, as it transitions to a new service model.
ASIC will continue to monitor CFPL’s transition to its new service model.
A copy of the executive summary of EY’s report dated 30 May 2019 is available here.