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Commonwealth Bank of Australia (CBAUF) told a government inquiry Thursday that the practice of billing deceased customers for financial advice stretched back years. In one instance, an adviser at the bank's financial planning business was collecting fees from a client more than a decade after they had died.
The revelations emerged as part of a Royal Commission, or public inquiry, into malpractice in Australia's financial services industry.
During a hearing Wednesday, Commonwealth Bank's executive general manager Marianne Perkovic admitted that the lender had charged customers fees for financial advice they never received. A day later, she conceded that Commonwealth Bank advisers had in some cases drawn fees from clients' accounts after they had died.
In one example, an adviser continued billing a customer for advice for more than a decade after they died in 2004.
When Commonwealth Bank became aware of this in 2015, the company recommended "a possible warning to the adviser," according to an internal document read out at Thursday's hearing. The adviser's behavior wasn't reported to Australia's financial watchdog.
The lender said Wednesday that by the end of 2017 it had paid out or offered refunds of 119 million Australian dollars ($93 million) to clients who had been charged for advice they never received.
Commonwealth Bank is Australia's biggest lender by market capitalization. A spokesperson for the bank didn't immediately respond to a request for comment on the issue of billing dead clients.
A Royal Commission is Australia's highest form of public inquiry. It was ordered by Prime Minister Malcolm Turnbull at the end of last year in a bid to restore public confidence in the country's financial sector.
It comes on the back of several big scandals in the industry, including alleged interest rate-rigging and money laundering. The commission is due to submit its findings to the government in February 2019.
Related: Wells Fargo timeline: Bank's 17-month nightmare
Commonwealth Bank isn't the only the lender that's been accused of behaving badly in recent months.
Only last month, Bank of America Merrill Lynch (BAC) admitted to "systematically misleading clients" for five years about how orders were handled for millions of stock trades.
And for the past 18 months, Wells Fargo (WFC) has been dogged by a scandal related to millions of fake customer accounts that were used to juice the bank's books.
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