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19 May 2018

Profit at any price

As if the recent shocking revelations about banking misconduct that have been uncovered at the Royal commission are not enough, we now hear that unsuspecting children are caught up in the latest banking scam.

We recoiled in horror as witnesses at the Royal Banking Commission revealed that dead clients were being charged fees for planning advice. Then we heard terrible tales about how some investment planners were pushing financial packages to earn tidy sales commissions, even when such products were not in their clients’ best interests.

Now, according to Fairfax Media, we learn that thousands of children’s Commonwealth Bank accounts were fraudulently activated by employees to earn themselves performance bonuses.

The scam operated as part of the Dollarmites program which offers “Games, downloads and lots of cool stuff” to children under 12 whose parents open Youthsaver accounts for their children. Unfortunately for bank staff, these accounts become dormant if no money is deposited in them within 30 days, and then don’t count towards bank employee sales targets or bonuses.

To solve this issue, some bank staff illegitimately activated dormant accounts without the knowledge or consent of either parents or the Dollarmite kids by depositing a little loose change to activate the accounts and become eligible for bonuses.

According to investigations conducted by Fairfax Media, this scam is part of “a broader culture of gaming financial incentives at the bank where staff were caught faking customer referrals to boost performance targets and earn rewards.”

Given that it now seems that even children’s bank accounts are being targeted in the pursuit of profit, we are entitled to ask - where will all this end?

Source: The Age, 18th May 2018