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Frequently asked questions relating to the ANZ / Commerce Commission Settlement
1. Will the Banking Ombudsman be reviewing cases already decided now that the Commerce Commission has come out with its findings?
The Banking Ombudsman has not been investigating the issue of whether or not the representations about risk in the DYF and RIF investment statements were misleading, as the Commerce Commission (“the Commission”) has been investigating this matter.
The Commission and ANZ National settlement includes a $45M refund to ING customers. The refund completes the Commission’s investigation into whether or not the representations about risk in the DYF and RIF investment statements were misleading or not.
The Banking Ombudsman is not able to change her past decisions for two reasons:
· because the issue as to representations about risk in the investment statements has been investigated and settled by a regulatory authority, it is now outside her jurisdiction
· even if the issue were inside jurisdiction, the Commission and ANZ National have only reached a settlement. Although the Commission is the expert body with respect to Fair Trading Act investigations, its findings are only opinions until tested in Court.
The Banking Ombudsman deferred to the Commission, as the expert body, in this matter. As there has been no testing of expert opinion, no Court finding, and no admissions of liability, she is not in a position to make a finding on this issue.
The Banking Ombudsman will continue to investigate whether ANZ National’s financial advisers made any direct misrepresentations to customers, as a separate issue from the representation as to risk contained in the investment statements.
The Banking Ombudsman has also carefully reviewed all of the Commission’s findings to ensure that her investigation has uncovered and addressed all of the other issues raised by the Commission. She is satisfied that her Office’s investigation has been thorough.
2. What about some of the early cases that the Banking Ombudsman completed?
As new information came to light, the Banking Ombudsman’s assessment criteria evolved. The Ombudsman has reviewed some of the early cases (those decided before 2009) to ensure that all complainants were treated fairly.
3. What has the Banking Ombudsman’s process achieved?
The Banking Ombudsman was instrumental in determining that a systemic failure may have occurred, and that more people may have been affected by the dramatic decline in the value of the DYF and RIF than initially complained to her Office. The Banking Ombudsman developed an approach to the issues raised by complaints received from ANZ National customers who had investments in the DYF and RIF.
That approach to assessment and settlement of compensation was subsequently accepted by ANZ National and, ultimately, led to:
· the ING settlement offer of $0.60 and $0.62 return of funds invested to all investors, whether customers of ANZ National or not
· the opportunity for ANZ National customers to claim additional compensation from the Bank (the NSAC process).
The final figures for the amount of compensation returned through the Banking Ombudsman process, and the proportion of complainants receiving full or partial refunds is not yet known. To date (7 July 2010), the investigation of some 480 cases has been completed, another 200 cases are either under or awaiting investigation.
4. When does the Banking Ombudsman expect to complete her investigations?
The Banking Ombudsman hopes that the investigation of all remaining cases will be completed by the end of November 2010.
5. When will investors know whether they are entitled to participate in the Commerce Commission compensation and does this make any difference to the Banking Ombudsman’s investigations?
ANZ hopes to advise all investors by mid August whether or not they are eligible for the Commerce Commission compensation. The Banking Ombudsman is continuing with her investigations and is using the same formula for the calculation of compensation as she has used for the past 12 months. This formula disregards any potential compensation an investor may receive from the Commerce Commission settlement. Investors whose cases are currently being reviewed by the Banking Ombudsman will not be disadvantaged by accepting any compensation negotiated through the Banking Ombudsman’s office”.