Former Public Service Commissioner, Stephen Sedgwick AO, was appointed by the ABA to review how bank tellers and other customer-facing bank employees, their managers, and third parties are paid by banks.
The review was charged principally with examining product sales commissions and product based payments received directly or indirectly by people selling retail banking products. Such payments are linked to the number or value of products sold, offered, or distributed to retail and small business customers. The review was also required to comment on the principles that banks might apply when structuring remuneration more generally.
The roles in scope were staff of banks (Tellers, Sellers and their supervisors and near managers (‘Managers’)) as well as third parties (including Brokers, Aggregators, Franchises, Introducers and Referrers).
Products that were in-scope included:
• Basic banking products (e.g. transaction accounts, term deposits, travellers cheques);
• Non-cash payment products (e.g. travel money cards);
• General insurance products (except for personal sickness and accident);
• First Home Saver Accounts (FSHA);
• Consumer credit insurance (CCI);
• Consumer credit products (mortgages, personal loans and credit cards); and
• Small business lending.