How ANZ OnePath ramped up grandfathering language

Two letters sent by ANZ OnePath to its superannuation fund members in February and the end of May have revealed a significant toughening up of language around how those members could end grandfathered commissions.

In the first letter, dated February, ANZ OnePath suggested that member contact their financial adviser or write to ANZ OnePath if they wanted to end commissions while in the second letter dated in May members are being informed they can adviser OnePath directly and that “you are not required to notify your financial adviser in order for us to cease paying commission”.

A number of advisers affected by the ANZ OnePath letters have suggested that the toughening up of the language between the two pieces of correspondence reflect the involvement of the Australian Securities and Investments Commission (ASIC).

A copy of the February letter obtained by Money Management reveals that the reference to grandfathered commissions is as follows:

“We may currently pay commissions to a financial adviser in relation to your product. The trustee is reviewing payment of commissions to financial advisers. Contact your financial adviser, or write to us, if you want us to cease paying commissions. If you are uncertain whether to pay commission in relation to your product please contact us.”

The second letter dated in May states:

“We are writing to remind you to consider the adviser payment arrangements in relation to you account.

Recently, the Financial Services Royal Commission recommended that ‘grandfathered’ commissions currently paid to financial advisers in relation to superannuation and pension products, cease being paid. Although this recommendation is yet to be legislated, it is expected to be.

In anticipation of this change, the trustee of your super fund, OnePath Custodians Pty Limited, has been reviewing the payment of adviser commissions.

Currently, we are paying your financial adviser commission in relation to your OneAnswer Personal Super.

What do you need to do?

You can advise us directly to cease paying future commission immediately in relation to your account. You are not required to notify your financial adviser in order for us to cease paying commission.”

Elsewhere, the ANZ OnePath letter suggests that members will “generally benefit from reduced product fees once commission payments cease”, adding “Where you have an ongoing relationship with your adviser, we recommend that you speak to them regarding your arrangements”.