AMP Limited Shareholder Class Action
This is a class action against AMP Limited (ASX:AMP) (AMP) in relation to losses suffered by AMP shareholders caused by AMP’s failure to disclose the misconduct that was revealed at the Financial Services Royal Commission on 16 and 17 April 2018.
The proceeding are being be conducted by experienced class action lawyers Phi Finney McDonald.
AMP is an ASX-listed financial services company which provides personal financial advice. On 16 and 17 April 2018, AMP Head of Advice Anthony Regan gave evidence to the Financial Services Royal Commission. His evidence revealed:
- From 2006 to November 2016 AMP had an ongoing practice of charging some clients certain fees for personal financial advice when those clients were not provided (and could not be provided) personal financial advice. At the Royal Commission, Mr Regan admitted that the charging of fees for no service was in breach of contract and AMP’s statutory obligations, and was unethical.
- These fees were charged pursuit to AMP’s business practices and policies, including a policy approved by an AMP management committee on 24 May 2013. The approval was granted despite the committee being advised that charging the fees could result in “reputational damage to AMP” and “legal and compliance issues” **
- Between 27 May 2015 and 3 May 2017 AMP provided 20 false or misleading statements to ASIC about the fees for no service practice and in doing so repeatedly gave the impression that ‘fees for no service’ was an administrative error, rather than a business policy.
- A document review by AMP in April 2017 unearthed a chain of emails from June 2015 showing that AMP employees knew ‘fees for no service’ was a breach of AMP’s license condition. The emails were escalated to the highest levels of AMP, resulting in the commissioning of a report by Clayton Utz. The Clayton Utz report was presented to ASIC as an “entirely independent” report, yet draft versions of the report were changed 25 times following requests from AMP, including removing references to the CEO of AMP.
On 20 April 2018 AMP released a statement to the ASX apologising “unreservedly for the misconduct and failures in regulatory disclosures in the advice business”. The company also announced that CEO Craig Miller would resign effectively immediately.On 30 April 2018 AMP issued a further statement, announcing the departure of Chairman Catherine Brenner and General Counsel Brian Salter.
In response to the revelation of the above misconduct the AMP share price fell by from $4.76 to $4.28 ($0.48 or 10%) from 2pm 16 April 2018 to close on 20 April 2018. At the close on 24 April 2018 the AMP share price was $4.06.
Cause of Action
The class action, being conducted by experienced class action lawyers Phi Finney McDonald on behalf of aggrieved shareholders of AMP, alleges that AMP:
- breached its obligations of continuous disclosure by failing to disclose the information set out above; and;
- made misleading and deceptive representations to the market regarding its compliance with the law. The claim will allege that, had AMP's misconduct been disclosed in a timely manner, it would have affected the confidence of investors in the management of AMP and AMP shares would have traded at a lower price.
The claim alleges that, had AMP's misconduct been disclosed in a timely manner, it would have affected the confidence of investors both in the management of AMP and in AMP's brand reputation, and AMP shares would have traded at a lower price.
Further details about the claim can be obtained by contacting IMF using the details below.
Current stage of case
Please contact IMF on [email protected] for more information.
** Financial Services Royal Commission Draft Transcript 17 April 2018, page 1143, line 45.