Macquarie Investment Management to refund clients after review of system errors 

Macquarie Investment Management Limited (Macquarie) is due to refund over $5.5 million to around 2,300 clients affected by system errors. The errors occurred between 2001 and 2014, on a number of products using the Macquarie Wrap Platform. ASIC has been working with Macquarie to resolve this matter in the interest of clients.

The system errors included:

• failing to apply sufficient tax credits to the GST portion of client fees
• charging administration fees which exceeded the maximum disclosed in the product offering documents.

In discussion with ASIC, Macquarie appointed Deloitte as an independent third party consultant to assess the controls and processes around Macquarie’s remediation and compensation arrangements to ensure that:

• all affected clients are identified and appropriately compensated
• Macquarie’s controls and processesare adequate to prevent a similar error occurring in future.

Deloitte’s review identified a third error, relating to the administration fee in an offering document.

All three errors have now been rectified and Macquarie will commence compensation (including all interest due) to clients from 17 June 2015 onwards. Clients who exited affected products more than 12 months ago will be contacted by Macquarie to discuss refund arrangements.

Commissioner Greg Tanzer said, ‘We welcome the reporting of large system errors to ASIC. Where errors do occur, entities must  identify and appropriately rectify them  as soon as possible.’

‘ASIC will work with entities who report issues to us to ensure consumers are compensated in a timely, effective way’.

ASIC acknowledges the cooperative approach taken by Macquarie in this matter.

Source: ASIC – Macquarie Investment Management to refund clients after review of system errors

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