News National Hockey slams bank

Hockey slams bank

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Treasurer Joe Hockey is unimpressed by the Commonwealth Bank’s handling of fraud and misconduct by financial advisers that resulted in more than 1100 customers losing savings.

Mr Hockey, who has just returned from China, says he isn’t satisfied by the bank’s response, which he’s described as appalling.

“I think the bank’s got to lift its game,” he told reporters at the Liberal Party’s federal council in Melbourne.

“I think the Commonwealth Bank has handled this appallingly.”

However the treasurer said as his mother-in-law had been affected by the fraudulent activity it would be up to Finance Minister Mathias Cormann as to what the federal government did next.

The federal government has been lukewarm about calls for a royal commission.

A Senate inquiry report last week detailed failings of the Commonwealth Bank and the Australian Securities and Investments Commission in dealing with fraudulent activity between 2006 and 2010.

The senate committee investigated ASIC’s slow response to whistleblowers inside the Commonwealth Bank who raised the alarm on misleading and deceptive conduct by financial advisers that included forging client signatures to allow profit-producing product switches.

Customers were switched into high-risk investment products without their consent and then lost large amounts of their savings when the global financial crisis hit.

The Commonwealth Bank has apologised for failing customers but denies accusations it downplayed the extent of wrongdoing or tried to minimise compensation for affected customers. The bank’s compensation scheme for victims has also been widely criticised.