More than a quarter of a billion dollars has been, or is scheduled to be, refunded to customers after banks and financial service providers were found to have charged ongoing fees for advice that was never provided.
The Australian Securities and Investments Commission (ASIC) revealed that some $259.6 million in refunds and interest has been paid or offered to customers who were the victims of bogus fees and charges.
The vast majority — $222.3 million — has come from the four major banks as well as AMP.
CBA alone will return more than $143.3 million, with ANZ the next biggest at $59.2 million.
BankVic, StatePlus and Yellow Brick Road Wealth Management are also implicated, with StatePlus owing its customers an estimated $37.2 million.
The overall figure is expected to balloon further, though, with the fee for no service (FFNS) scandal continuing to roll on.
ASIC said that another five organisations were preparing remediation to customers. However, investigations into unfair charges are ongoing, and interest on amounts owed to customers may either be inaccurate or not yet accounted for, meaning the total reparations will inevitably climb much higher.
“If all of these provisions are paid in full, FFNS remediation may exceed $850 million,” ASIC noted.
Anyone who believes they have been charged bank fees for services not provided should lodge a formal complaint through their bank or adviser’s dispute resolution procedure, or alternatively with the Financial Ombudsman Service.
The news comes as the financial services royal commission resumes hearings, this time exploring fees and advice on superannuation.
My Business’ sister publication Nest Egg is covering the hearings live on its blog.
It comes just as the federal government announced an extra $70.1 million in funding for ASIC, enabling it to embed staff within AMP and the big four banks to ensure compliance and bolster enforcement.
Adam Zuchetti is the editor of My Business, and has steered the publication’s editorial direction since early 2016.