IOOF commissions independent review

The announcement of an independent review was prompted by a series of articles published over the weekend in the Fairfax press alleging insider trading and front running by IOOF employees.

ASIC has now confirmed that it is investigating the financial services company.

The announcement of an independent review was prompted by a series of articles published over the weekend in the Fairfax press alleging insider trading and front running by IOOF employees.

The results of the review will be passed on to the corporate and prudential regulators, said IOOF in a statement to the ASX.

Specifically, PwC will be engaged by IOOF to "oversee and advise" an existing internal review being conducted by group head of research and portfolio construction Matthew Drennan.

Mr Drennan was previously the chief investment officer of SFG Australia before it was acquired by IOOF in January 2015.

"The IOOF Advice Research division was reviewed in 2014, which led to the restructure in March 2015. This resulted in the appointment of a new 'Group Head of Research and Portfolio Construction'," said the IOOF statement.

"The new Group Head is currently reviewing the existing policies, procedures and how research is conducted and disseminated through the Group. PwC will be engaged to oversee and advise on the review," said the statement.

PwC will assess the "design and operating effectiveness" of the IOOF research division's "control environment", said IOOF.

The accounting firm will conduct "system walk throughs" to identify the effectiveness of IOOF processes and controls; it will test the operating effectiveness of the "control environment"; and it will conduct design effectiveness testing, said the statement.

PwC will also be tasked with reviewing IOOF's breach reporting policy; the effectiveness of IOOF's breach reporting systems, processes and controls; and the operating effectiveness of the breach reporting process.
IOOF said it would keep the market informed of any "material outcomes" of PwC's review.