Full Federal Court upholds dismissal of ASIC case against CBA

The news: The Full Federal Court has thrown out ASIC's appeal against an earlier Federal Court decision to dismiss the regulator's case against CBA and its subsidiary Colonial over alleged conflicted remuneration.

The numbers: ASIC alleged CBA and its subsidiary Colonial broke conflicted remuneration laws through an agreement whereby Colonial paid CBA to push its Essential Super product to more than 390,000 retail clients. According to ASIC, CBA won $22 million in conflicted remuneration from Colonial First State for the recommendations.

The context: CBA and Colonials' arrangements in distributing Essential Super products were a case study in the Hayne royal commission inquiry, which took place between 2017 and 2019. CBA sold a 55% stake in Colonial to KKR in 2021, which it agreed to the year before in the wake of the royal commission. The inquiry led to a number of banks selling-down some of their more controversial businesses and exiting the life insurance sector completely.