Westpac and AMP say they will back compensation for victims of financial advice scandal
Westpac's CEO, Brian Hartzer, together with the CEO of AMP, Craig Meller, have told an Australian Senate committee that they will support a move to create a compensation scheme for victims of the wide-reported financial advice scandal; ANZ said that it would support such a move last week. The CEO's of both Westpac and AMP also both expressed their support for new government measures to raise capital requirements on the nation's banks, and to tighten professional indemnity insurance requirements at smaller players in the market, so as to prevent too large a burden falling on the big banks to subsidise the compensation scheme.&nbsp;
The heads of Westpac and AMP have told a Senate committee they would back moves to force them to pay into a compensation scheme to provide a safety net for victims of their smaller rivals who have been left destitute, and pay higher licensing fees to help fund policing of their industry.

Late on Monday, AMP Ltd chief executive Craig Meller and Westpac chief executive Brian Hartzer both told the Senate committee into scrutiny of financial advice they would support the establishment of a last-resort scheme for investors unable to receive the compensation awarded to them by a court for poor financial advice because their financial planner had gone broke or was refusing to pay.

AMP chief executive Craig Meller says he would support the establishment of a last-resort scheme for investors unable to receive the compensation awarded to them by a court for poor financial advice because their financial planner had gone broke or was refusing to pay. Credit: Daniel Munoz

Two of the big four domestic banks have now contradicted peak body the Australian Bankers' Association, which earlier last week fended off the suggestion, arguing there was "no urgent need". ANZ deputy chief executive Graham Hodges told the Senate hearing last week that his bank would also support such a scheme.

However, Mr Meller and Mr Hartzer both linked their support to a call for the government to lift standards, ensure higher capital buffers, and tighten professional indemnity insurance requirements at their smaller rivals to limit the burden on large institutions of subsidising a compensation scheme.