Abbott needs to take a tougher line on financial planners

Abbott needs to take a tougher line on financial planners

By Steve Keen

Of course, we’ll never know whether the Commonwealth Bank would have remained a responsible influence on banking had it not been privatised in the 1990s by the Keating and Howard governments, but I’ve always liked the perspective on a mix of private and publicly owned institutions that Hugh Stretton once expressed: “they need us to keep them honest, and we need them to keep us efficient”, he said.

This report exposes, in excruciating detail, fraudulent behaviour within Commonwealth Financial Planning Limited between 2007 and 2011, and the timidity of ASIC, the institution supposedly overseeing how well the retirement savings of Australian households are managed.

CHAIR: Yes, but, if the problem derives from the fact that the officers of Commonwealth Financial Planning at first instance, with any or all of the 7,000 clients, did not do their job properly, did not maintain records, falsified records, falsified signatures, so that nothing could be reconstructed properly, in terms of outcomes, bad luck for the Commonwealth Bank.

But it’s much easier to see the cavalier behaviour this report exposes as the product of a systemic sales culture that has taken over banking and finance in the last 30 years, and which became visible even to the blind, thanks to the global financial crisis.

Read more here: Business Spectator


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