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19-001MR Westpac subsidiaries Federal Court decision
ASIC will review the Federal Court decision handed down on 21 December 2018 regarding Westpac subsidiaries, including the finding that Westpac Securities Administration Limited (WSAL) and BT Funds Management Limited (BT Funds) failed to do all things necessary to ensure that the financial services covered by their licences were provided honestly, efficiently and fairly.
The Court found WSAL and BT Funds breached the Corporations Act (section 912A(1)(a)) but that ASIC did not make out its case that personal advice was provided to the 15 customers.
The matter will return to the Court on 7 February 2019.
ASIC commenced civil penalty proceedings on 22 December 2016, alleging that WSAL and BT Funds had breached the 'best interests duty' introduced under the Future of Financial Advice reforms by conducting a telephone sales campaign recommending that customers roll out of their superannuation funds into their Westpac-related superannuation accounts without undertaking a proper comparison of the superannuation funds, as required by law.
ASIC contended that, through this conduct, WSAL and BT Funds had provided personal financial product advice to customers, in breach of their Australian financial services licences, among other things (16-460MR). The matter was heard in February 2018.
On 28 October 2019, the Full Federal Court upheld ASIC’s appeal from a decision of the Federal Court regarding Westpac subsidiaries, Westpac Securities Administration Limited (WSAL) and BT Funds Management Limited (BTFM) (19-293MR).
Editor's note 2:
On 25 November 2019, Westpac filed an application seeking special leave from the High Court to appeal the decision of the Full Federal Court. A timetable to progress the application is yet to made. The application will be contested by ASIC.
Editor's note 3:
On 24 April 2020, the special leave application was heard and granted. An appeal date has yet to be set.
Editor's note 4:
On 26 August 2020, the hearing date for the appeal in the High Court was listed to be heard on 7 and 8 October 2020.
Editor's note 5:
Westpac’s appeal to the High Court was heard on 7 and 8 October 2020. Judgment has been reserved.