What is the Banking Royal Commission?

On December 2017, the Governor-General of the Commonwealth of Australia, His Excellency General the Honourable Sir Peter Cosgrove AK MC (Retd), appointed former High Court Judge, the Honourable Kenneth Madison Hayne AC QC to lead investigations into alleged misconducts in the banking, superannuation and financial services industry, marking the start of the long-debated Banking Royal Commission.

To date, up to 9,388 public submissions have been received by the commission, covering industries such as Banking (62%), Superannuation (12%) and Financial Advice (9%). 

6 rounds of public hearings have been conducted over the period March to September 2018. Investigations are ongoing with a final report due on February 2019.

Topics covered in the various rounds of past hearings are highlighted below.

Round 1: Consumer Lending

#TopicCase studies
1Residential MortgagesNAB Introducer Program and fraudulent loan applicationsAussie Home Loans fraudulent brokers and broker arrangementsCBA accreditation of brokers and broker arrangements
2Car FinanceWestpac/St George car finance practicesANZ/Esanda car finance practices
3Credit CardsWestpac unsuitable credit card limit increasesCiti imposition of international transaction fees
4Add-On Insurance ProductsCBA credit insurance in connection with home loans, personal loans and credit cards
5Credit OffersANZ unsuitable pre-approved overdraft offers
6Account AdministrationANZ account administration errorsCBA unsuitable overdraft facilities and failure of automated systems

Source: Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry

Round 2: Financial advice

#TopicCase studies
1.Fees for no serviceAMP, AMP Financial Planning Pty Ltd, Charter Financial Planning Ltd and Hillross Financial Services LtdCBA, Commonwealth Financial Planning Ltd and Count Financial Planning
2.Investment platform feesAMPCBA
3.Inappropriate financial adviceANZ, RI Advice Group Pty Ltd and Millennium 3 Financial Services Pty LtdWestpac and BT Financial GroupAMP, AMP Financial Planning Pty Ltd, Charter Financial Planning Ltd and Genesys Wealth Advisers Ltd
4.Improper conduct by financial advisersNABANZ and Millennium 3 Financial Services Pty Ltd
5.The disciplinary regime for the financial advice professionASICFinancial Planning Association of Australia LtdAssociation of Financial Advisers LtdDover Group

Source: Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry

Round 3: Loans to small and medium enterprises

#TopicCase studies
1.Responsible lending to small businessesANZBank of QueenslandCBAWestpacSuncorp
2.Approach of banks to enforcement, management and monitoring of loans to businessesCBA / BankwestNAB  
3.Product and account administrationCBA
4.Extension of unfair contract terms legislation to small business contractsASICWestpacSuncorp
5.The Code of Banking PracticeABAASIC

Source: Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry

Round 4: Experiences with financial services entities in regional and remote communities

#TopicCase studies
1.Farming financeCBA (Bankwest)RabobankNABCBABendigo and Adelaide Bank (Rural Bank)ANZ (Landmark)
2.Interactions between Aboriginal and Torres Strait Islander people and financial services entitiesSelect AFSL, trading as Let’s InsureACBF Funeral PlansANZ

Source: Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry

Round 5: Superannuation

#TopicCase studies
1.Duties of RSE Licensees (including structural and governance arrangements, the relationship between trustees and financial advisers and selling practices)AMP Super and NM Super (AMP)Australian SuperCatholic Super (CSF)Colonial First State (CBA)Electricity Supply Industry Superannuation (Qld)Host-PlusIOOFMercerNULIS (MLC/NAB)Onepath and Oasis (ANZ)SuncorpSunsuperUnited Super (CBUS)
2.Superannuation funds and Aboriginal and Torres Strait Islander membersQSuper
3.Effectiveness of superannuation regulatorsAPRAASIC

Source: Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry

Round 6: Insurance

#TopicCase studies
1.Life insuranceAMPClearViewCommInsureFreedom InsuranceRESTTAL
2.General insuranceAAI (Suncorp)AllianzIAGYoui
3.Regulatory regimeCode Governance CommitteeFinancial Services CouncilInsurance Council of Australia

Source: Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry

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