Westpac to remediate customers who weren’t notified of corporate action information

The major bank estimates approximately $87 million will be paid in compensation to customers who are former clients of Westpac’s advice businesses.

The corporate action information that may have failed to be communicated includes buy-backs, renounceable and non-renounceable rights issues, share purchase plans and takeovers.

“Westpac’s failure to notify customers of corporate actions means customers may have missed out on various opportunities,” a statement released by ASIC on Friday read.

“These include purchasing additional shares often at a discount to the market price, the creation of temporary rights or options that can be sold for a profit, and the ability to sell shares and receive a benefit that can be tax advantageous depending on the shareholder’s circumstances.

“Westpac’s remediation covers an estimated 328,000 potential missed corporate action notifications impacting approximately 32,000 customer accounts. This is a complex remediation due to the various types of corporate actions involved.”

Westpac said it aims to compensate most of the affected customers by the end of the year.

“Compensating customers affected by misconduct is a very important part of licensees’ obligations to act fairly, honestly and efficiently. We are pleased to see that Westpac has taken action to remediate affected customers regardless of how much time has passed,’ ASIC Commissioner Danielle Press said.

“We encourage affected customers to engage with the communications from Westpac to understand how they were impacted and to seek further information from Westpac if required.”

Neil Griffiths

Neil is the Deputy Editor of the wealth titles, including ifa and InvestorDaily.

Neil is also the host of the ifa show podcast.