No Win - No Fee
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If you have paid a fee for no service you may be eligible for a refund.
Fee for No Service is defined as the failure to provide continuous advisory services to financial advice customers who have been paid fees for such services.
There are a variety of reasons why these failures may occur. The adviser may have retired or resigned, and the AFS licensee did not appoint a new adviser to serve the client. In other circumstances, the adviser may have simply neglected to present the customer with the yearly review for which they had paid.
Update as of 14th February 2022: Six of Australia’s largest banking and financial services institutions have paid or offered a total of $3.15billion in compensation, as at 31 December 2021, to customers who suffered loss or detriment because of fees for no service misconduct or non-compliant advice.
You may be eligible for compensation if you’ve been subjected to these over charges. However, by producing the relevant paperwork, the organisation can still prove they provided the services for which you were charged. To verify the provision, the AFS requires licensees to produce their Record of Advice or Statement of Advice.
Secondary evidence must be reliable if the firm relies on it to determine whether yearly evaluations have been completed. The AFS anticipates independent quality assurance to confirm that clients have got their services. With the support of third-party assurance providers, this may be accomplished.
It’s important to note that there are a variety of different scenarios to consider beyond just the above where fees for no service may apply.
Banking institutions, also for example, frequently charge their customers a single ongoing-service-arrangement cost that requires them to provide a variety of different services in addition to yearly evaluations. Seminar invites and quarterly mailings are examples of supplementary services. If the consumer does not receive either and is still charged, they will be charged for the service they did not receive.
Customers may also be required to settle costs for non-existent services if the company that serves them depends on automated periodic payments. This usually comprises of sales commissions and advisory fees. Some licensees emphasise fee generating and advice revenue above ensuring they’re truly performing the essential services under such arrangements. As a result, clients may not receive what they requested yet are still charged a cost.
Claimo offers a service to help check your documents or request relevant paperwork for free.
Claim are Fee for No Service experts.
If you believe that you have paid fees for no service Claimo can assist you with looking into this on your behalf. Our team are highly qualified and knowledgeable on the different scenarios and understanding why you may be entitled to a refund.
Claimo recently helped a Sydney client get back $4700 in Fees for No Service. Enquire today for more information and to find out how we can help!
Six of Australia’s largest banks and financial services institutions have paid or offered a total of $3.15billion in compensation, as at 31 December 2021, to customers who suffered loss or detriment because of fees for no service misconduct or non-compliant advice.
This includes almost $1.3bn paid or offered by the institutions between 1 July to 31 December 2021 (refer 21-203MR).
The financial institutions in question are: AMP, ANZ, CBA, Macquarie, NAB and Westpac. The institutions undertook the review and remediation programs to compensate affected customers as a result of two major ASIC reviews (refer to Background here). ASIC commenced the reviews to look into:
Aware Financial Services Australia Limited (Aware FS), formerly known as State Super Financial Services Australia Limited (StatePlus), has been ordered by the Australian Federal Court to pay a $20 million penalty for charging over 25,000 customers fees for financial services it did not provide, in contravention of the ASIC Act.
ASIC Deputy Chair Sarah Court said, ‘Aware FS charged fees to tens of thousands of customers for financial services it had grounds to believe it would not be able to provide. As a result, over $50 million in fees was charged to customers who have nothing to show for it.’
‘Financial services providers should treat the penalty imposed today as an important reminder to maintain robust internal controls and compliance systems. Firms are responsible for ensuring they only charge consumers for the services they provide. If they fail in this obligation, they face significant penalties.’
Between 21 August 2014 and 30 June 2018, Aware FS charged approximately 25,300 customers a total of $50 million in fees for advice services included as part of the superannuation product offered by Aware FS, which at that time was also a superannuation trustee. The firm provided at least 17,500 customers with written disclosure documents advising them that they would receive an annual financial planning review called an Annual Review Service. Another 7,800 customers entered into ongoing advice service arrangements that included the provision of an Annual Review Service. However, Aware FS did not provide the promised services.
The Court found that by charging fees for no service and failing to have internal procedures, measures and controls in place to monitor compliance, Aware FS also breached its obligations as an Australian financial services licence holder to act efficiently, honestly and fairly and to comply with financial services laws.
ASIC has filed a civil penalty action in the Federal Court against OnePath Custodians Pty Ltd (OnePath), a superannuation trustee, for allegedly collecting fees for no service and making false and misleading claims to fund members.
According to ASIC, OnePath charged over $4 million in fees to over 18,000 fund members when it wasn’t allowed to.
According to ASIC, OnePath made false and misleadingstatements regarding its right to continue charging fees to these members,engaged in deceptive or misleading conduct, and failed to meet its duties as afinancial services licensee to offer services efficiently, honestly, andfairly.
ASIC Deputy Chair Sarah Court said, ‘Superannuation isimportant for the future financial security of Australians. Consumers must beable to trust they are being charged fees correctly by their superannuationproviders. ASIC’s case alleges that OnePath failed to do so in this case.’
Claimo offers a service to help check your documents or request relevant paperwork. If insurance is located we submit a refund request on a no win no fee basis on eligible claims.
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