PM quiet after Senate inquiry recommends investigating bank
PRIME Minister Tony Abbott has all but ruled out a royal commission into allegations of fraud and forgery among financial planners at the Commonwealth Bank.
After a Senate inquiry last week recommended the judicial inquiry, both Mr Abbott and Finance Minister Senator Cormann went quiet, not ruling such an investigation in or out.
But despite ordering two royal commissions since taking office and numerous other government reviews; Mr Abbott on Thursday said he did not believe in conducting more reviews into the matter.
"I don't want to overdo the reviews because in the end what people expect from government is appropriate action, not endless study, particularly studies which don't necessarily lead to outcomes," he said.
The Senate report on Thursday highlighted many allegations of forgery, fraud and misuse of bank clients' funds by questionable advisers in two of its financial planning subsidiaries.
It found the bank was responsible for losing hundreds of millions of dollars of thousands of clients' money over a period spanning almost 10 years to 2012.
The inquiry also found the response to the allegations by the Australian Securities and Investments Commission to be lacking in rigour, and questioned the ability of the regulator to prevent similar future problems.
But on Thursday, CBA chief executive Ian Narev broke a week's silence on the issue, issuing an "unreserved apology" and declaring the bank would start an "open advice review" for affected customers.
The bank's internal review will allow customers given advice by the banks financial planning unit and Financial Wisdom subsidiary between 2003 and 2012 to ask for an assessment of the financial advice.
But the onus would be on the customers to provide evidence that the advice they were given by the bank's advisers was faulty, or that investments were made on their behalf without their knowledge.
The Senate inquiry chairman, retired Labor Senator Mark Bishop told ABC on Thursday the review was simply "the bank reviewing the bank" and that the Senate inquiry had found it was not willing to act previously.
While Mr Bishop welcomed the bank's change of heart, he said it was not enough, again calling on the government to initiate an independent inquiry or judicial review of both the bank and ASIC's actions.
But such an order is unlikely, with Senator Cormann releasing a statement which said he believed the bank's internal review offered the only opportunity for "a satisfactory resolution" for unresolved issues for aggrieved bank customers.
"The government will monitor implementation of the Open Advice Review Program as we finalise our response to all 61 recommendations of the Senate Economics Committee Report," the statement reads.