Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry

Running head: ECONOMICS
Economics
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ECONOMICS
The Royal Commission into Misconduct in the Banking, Superannuation and Financial
Services Industry in light of the role of ethical values in economic decisions.
Discussion of the article
The banks are known to have a special place in the economy. The Royal Commission
into Misconduct in the Banking, financial services and superannuation had been established
in 2017. Banks are often known to face conflicts of interest when it comes for advising their
customers (ABC News. 2019). The interim report of the Royal Commission into the
Misconduct in the Banking, superannuation and the Financial services Industry have released
its interim report at the end of September.
The Royal Commission into Misconduct in the Banking, superannuation and the
Financial Services industry had been established in December 2017. The interim report had
been published on 2018 and covers customer lending, small and medium sized enterprise and
financial advice. The Royal Commission has been launched in December 2017, which
follows the claims of consumer base, poor governance along with unethical lending practices
which are adopted by banks. The final report that is provided care known to contain key
observations along with many recommendations with the view of a structural reform. The
Royal Commission into the Misconduct in the Banking, Superannuation and Financial
services industry known to have shone a spotlight on the sector. The final report of Kenneth
Hayne known to offer more than 70 recommendations, which the Federal government and
Labour will be supporting.
The three particular issues which are related to the article are

ECONOMICS
Superannuation
Australian Securities and Investment Commission (ASIC) will become the regulator
overseeing superannuation. It will also have the power of creating civil penalties for not
following the laws governing superannuation trustees. The hawking of the products of
superannuation is also not allowed so that people cannot sell superannuation products in the
unsolicited manner. The royal commission have also recommended the banking executive
accountability regime which governs the responsibility when the issues arises. There is also
presence of new protections in order to make sure that the superannuation fund members
should be having only one account (ABC News. 2019). The royal commission known to have
recommended deductions for any advice fees that needs to be prohibited from the account of
My Super.
Compensation for consumers
The government is also known to establish compensation scheme for allowing the
consumers and the small businesses which have not succeeded to have their cases heard. The
government will also be paying $30 million to the small businesses for the unpaid
determinants from the Financial Ombudsman Service. This particular scheme introduced by
the government will be paying compensation where a tribunal have ruled in favour of the
consumer.
During the investigation of misconduct Commissioner Hayne have observed that the
level of conflict of interest had been quite alarming due to the constant pursuit of the goals
along with lack of ethical remuneration structure. It was also observed that there has been no
separation of duties between the provisions of the financial device. The National Australia
Bank will also stop paying commissions to the members of the public who will be referring
new home loan consumers to the bank.