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ASIC allowed this salesforce gaming system to operate AND MUTATE
since at least 2001.......off with their bloody heads!
01/183 ASIC concludes ANZ Bank review
Thursday 31 May 2001
The Australian Securities and Investments Commission (ASIC) today announced that it has concluded its enquiry into allegations of inappropriate sales practices within ANZ Bank's Personal Financial Services division.
ASIC will continue to monitor ongoing compliance with the remedial measures implemented by ANZ as a result of its enquiry.
ASIC's National Director, Financial Services Regulation, Ian Johnston said that ASIC had been concerned
about aspects of ANZ's compliance systems, particularly whether or not consumers had suffered loss.
'While ANZ and PricewaterhouseCoopers have not detected any measurable loss to consumers, ASIC will
continue to call on the Bank to compensate any account-holders who have lost money through abuse of the
Salesforce system', Mr Johnston said.
'At the time of ASIC's enquiry, ANZ commenced an extensive review of its compliance procedures and systems. As a result of the issues highlighted by ASIC, and following detailed input from ASIC, ANZ is now working to a deadline to implement qualitative improvements to its systems over the next six months. It will report regularly to ASIC during that process', he said.
Mr Johnston added that ANZ had demonstrated a commitment to remedy the deficiencies within its Salesforce system from the outset and had cooperated fully with all of ASIC's requests.
'They are to be congratulated on their willingness to accept fault and to move quickly to solve this problem which was of concern to both ASIC and, more importantly, ANZ customers', Mr Johnston said.
The Bank has instituted a comprehensive review of its internal compliance systems and procedures, to prevent a
repetition of misbehaviour, after ASIC's enquiry revealed instances of inappropriate conduct by certain ANZ staff
(in breach of the Code of General Banking Practice) and the potential for further misconduct to occur.
ASIC announced on 20 December 2000 that ANZ had appointed Pricewaterhouse-Coopers as an external
consultant to review and report to ASIC and ANZ on the Salesforce system.
As a result of the enquiry and PricewaterhouseCoopers' review, it appeared that:
- Isolated instances of misconduct had occurred within the Personal Financial Services division. The Bank had undertaken its own investigations and disciplinary measures had followed.
- Although compliance systems and procedural deficiencies within the Bank revealed the potential for further gaming conduct which could cause loss to customers through increased fees or charges, no systemic, serious or on-going instances of such behaviour causing financial loss to customers have yet been detected.
- Some staff had misinterpreted the Salesforce system to focus more on sales rather than customer service, with the result that gaming could occur in volume or transaction-driven sales activities.
- Systemic deficiencies in resources, communication, supervision and record-keeping had encouraged the development of a culture within parts of the Bank which suggested that sales activities were the primary objective of staff and the most important determinant of performance-based rewards.
- Three transactions types were identified as requiring particularly close attention,
- deposit accounts opened without customer consent;
- accounts being opened and closed to gain rewards through churning; and
- internet banking registrations being established without customer consent.
On 8 November 2000, ASIC announced it had commenced the enquiry, following publication in the Australian
Financial Review of a staff memorandum from ANZ's Mr Larry Crawford alleging fraud, product-pushing and
gaming by sales staff in connection with ANZ's Salesforce incentive-based remuneration system.
ASIC will continue to monitor compliance at ANZ Bank.