Sydney, 24 November 2015
ABC TV’s 7.30 last night criticised Macquarie Equities’ client remediation program.
The program’s central claim - that Macquarie’s remediation approach is deficient and not subject to independent oversight - is refuted by the facts which were known to the ABC reporter and were not included in the segment:
Full details of the client remediation process can be found here
In questioning Macquarie’s remediation process, 7.30 highlighted two individual matters which were actually settled prior to the commencement of the client remediation program.
A third matter mentioned, regarding an ex-policeman, did not identify the client in question.
The program’s further claim that thousands of people had their life savings “squandered” is not supported by any evidence.
Macquarie provided 7.30 with the following detailed statement on its client remediation process prior to broadcast:
Macquarie Equities Limited entered into an Enforceable Undertaking with ASIC in 2013 which was concluded in January this year, with ASIC confirming all deliverables had been met. The Enforceable Undertaking was based primarily on compliance, and Macquarie embarked on a two-year implementation plan that has resulted in comprehensive change to the business.
This included the investment of $49 million over two years in new processes, practices and systems. There have been significant changes across the MPW business from senior management through to advisers. It has also involved rigorous external scrutiny by ASIC and the ASIC-approved independent expert, KPMG. The result is a transformed business and an ongoing commitment to continuous improvement.
Macquarie regularly updates the market on the progress of the client remediation program. At the last market update four weeks ago, Macquarie advised that as at 30 September 2015, of the Macquarie-initiated reviews 1,165 cases had been assessed with 83 eligible for $7.7m compensation. Of client initiated reviews, 1,500 complaints and file reviews had been assessed with 80 eligible for $6.3m compensation to date. These complaints are being processed as expeditiously as possible.
The client review is a comprehensive and rigorous process, which has seen 189,900 letters sent to current and former clients going back more than 10 years, so clients were made aware that they could seek a review of the advice they have received. This approach is based on consistent application of the FOS approach and is scrutinised by ASIC and Deloitte.
As part of the client review process, a case manager carries out a substantive assessment of the client’s file, which takes into account all relevant information and goes beyond a documentary review. This assessment is then peer reviewed by a second case manager and considered by a Review Panel before a determination is made. At this juncture, clients still have the opportunity to provide Macquarie with any additional information that may be relevant to their case which they believe has not been considered. Macquarie funds up to $5,000 for clients wishing to seek an independent professional review of the review outcome if they wish to do so, and FOS also provides an existing avenue for clients seeking a review. Macquarie Equities Limited has also waived any time or monetary limits which usually apply at FOS.
With regard to the Turnbull and Say matters, these were settled in 2009 and 2011 respectively. As all parties are subject to deeds of settlement, Macquarie is not able to provide any further comment.
Macquarie notes that one of the individuals, Mr Say, who identified himself on 7.30, has made further claims against Macquarie to FOS.
Macquarie is lodging a complaint with ABC TV.