Japan Post Bank admitted to having improperly sold investment trust products to elderly clients in around 19,500 cases just two months after its fellow insurance subsidiary admitted to a similar charge.
According to the bank, its investigations discovered staff negligence of an internal rule that provides additional protection to elderly clients. The rule requires that in the case of clients aged 70 years or older, staff are required to confirm that they are in good health and have good product understanding prior to making any sales.
«The problem comes from staff, without giving it much thought, believing it’s not a big problem,» a Japan Post Bank official told reporters last week.
The investigation also found that 17,700 and 1,891 of the cases occurred at bank branches and post offices, respectively, in the year ending March.
Bad Timing
Just two months ago, fellow subsidiary Japan Post Insurance admitted also to mis-selling policies to elderly clients. Over 180,000 policies were mis-sold over a five-year span with issues including double charging for terminated policies or existing clients unknowingly being uninsured.
The timing of these revelations couldn’t be much worse given that Japan Post Bank is in the midst of a share sales attempt to raise $10 billion to fund reconstruction in areas hit by the 2011 earthquake and tsunami.
