Speaking to ifa, ampfpa CEO Neil Macdonald has indicated that he would be willing to negotiate with AMP over changes to buyer of last resort (BOLR) agreements.
The changes to the BOLR resulted in massive devaluation of client books that AMP advisers bought from the group using funds borrowed from AMP Bank. In the aftermath of the changes, advisers owe the bank between $400 and $500 million, with some facing the prospect of losing their livelihood and their homes.
But despite an impending class-action lawsuit against the wealth giant, Mr Macdonald still wants to talk it out.
“We’re still trying to get them to come to the table,” Mr Macdonald told ifa.
“We’re addressing all avenues. Our preferred position would be to get a negotiated outcome … and to have an outcome that is beneficial for all parties. That’s what we’ve done for 90-odd years in the association.”
However, Mr Macdonald confirmed that he has spoken to a number of funders who have expressed strong interest at ‘competitive terms’ and said that ampfpa is in the process of finalising the lawsuit.
As of yet, there has been no response from AMP.
“It’s forced our member’s hands because effectively they’ve gone from a position where they’ve had thirteen month’s notice period and borrowed money at four times and now told it’s worth a maximum two and a half, and possibly less than that because it’s grandfathered.”
Mr Macdonald also noted that impacted advisers have been in touch with their local members and the issue had been raised in NSW State Parliament.
“I think it’s unlikely that the government would intervene in this specifically but clearly the issue here is around small business owners being treated harshly by a major corporate,” he said.
AMP is also facing another class-action from Maurice Blackburn after revelations during the royal commissions that the bank overcharged superannuation customers.
Comment starting below with “some terrible comments” was posted by “Ten”. not sure why it says anonymous ?
Some terrible comments here and it only demonstrates people misunderstanding the news above or just found a piece of wet lettuce and want to beat someone up. Whats gives here fellow commenters. There seems to be a whole lot more happening than you give credit for and you do need to realise tactics. Dont be the bull who jumps over fence to see his girls n rips up all value, just take a strong confident stance n find the gate and do the lot! I hear the AMPFPA are actually working for every members needs and Id think they would be varied, big and small. Dont join the jolly bashers club n lay the boot in just because you assume please. Just grow one, and know that many in this industry are suffering deeply and find the future very unethical and challenging to all they stood for. Its the people who really need advise who wont be able to get in future. Breaks my heart.
The board of the ampfpa are not representative of the small adviser practice that AMP is shafting. They represent big business structures and don’t care about us small advisers. Time to pack it up ampfpa and the useless Board who use the association to trapeze around the country collecting an honorarium… Greed is everywhere!
Maybe the FPA, AMPFPA and FASEA can merge to create one hell of an inept, incompetent, conflicted snake pit.
This is an absolute travesty of corporate greed and a severe lack of empathy.I was once (thank God i sold and escaped) an AMP advisor, purely based on their very low lending criteria for external business. BUT… once in the fold it was a case of “we own your clients and you will use our products” While trying to be as independent as i could, it was damn near impossible due to the pressures of AMP BDM etc.
NOW… we will have a number of suicides due to advisors under severe financial stress having purchased at 4X and borrowed against the asset based on that, now they have lots $$$ thousands.
AMP will have further action against them i am sure, from bereaved families seeking compensation from AMP for their loss and further ongoing trauma.
I sincerely hope AMP has deep pockets (getting shallower) as the financial fallout will be huge, how the Csuite within AMP conduct themselves has been despicable.
My futurist prediction is this…
[i]No-one will use AMP, the brand is dead.
The bank will remain (as a pure deposit taking and mortgage entity).
AMP will be closed down as an organisation and may even (due to high legal costing and payout of not only RC outcomes but Advisors families claiming for preventable suicides)
There will be a number of cases in Federal Court against them, and they will effectively seek bankruptcy to avoid the payouts[/i][i][/i]
It’s interesting that AMPFPA have had no response from AMP, however, the Finance Sector Union (FSU) are in there fighting and working on negotiations
[color=blue]The AMPFPA has done absolutely nothing since AMP started to cannibalize their own advisers 2 years ago. Now they are threatening to spank AMP with a wet lettuce. Whoop dee doo Neil, you’ve done nothing and youre all out of options.
On a brighter note its great to see all of the association board members getting sweet deals from AMP.
There some communication came today from UFAA (UNITED FINANCIAL ADVISERS ASSOCIATION) who seems to be a new professional body organisation that have harboured disillusioned Financial Planners and Advisers who are willing to stand up for themselves and the rest of the Financial Industry members and fight all the injustice that we have all experienced over the last two years. They sounded a little bit self-promotional but what you can’t ‘take away from them is their description of a role that two main professional associations that supposed to represent Financial Planners and Adviser such as FPA and AFA in post RC era played.
“FPA AND AFA HAVE DONE NOTHING
Advisers feel the FPA and AFA have achieved nothing, are conflicted and simply roll-over and bow to whatever the FSC dictates. Advisers livelihoods are on the line and no one is representing Advisers…”
Looks like AMPFPA is not any better than these two at the end. Instead of standing up, ceasing all negotiations with AMP and a class action and fight this BIG FAT LIAR to its end it still wants to negotiate “…an outcome that is beneficial for all parties”. Why would they want to negotiate with, AMP? AMP haven’t replied to any of their invitations simply ignoring them. Common fellows be real, have self-respect be gutsy and not gutless just remember that you have little army of people willing to fight behind your back who need a leader not a coward.
This is the death knell for ampfpa. Neil will go down as the ‘Peter Fankhauser’ and be the last CEO of the association after early 100 years. Can’t even get a class action going (we all feel for the advisers)…. AMP don’t need to talk to you or the Board. Bye ampfpa.
Rebel Ex Adviser, rest assured that AMP will get their “come uppance”, the carcass that is left will rot and they will no longer exist within a few short years or sooner. How do I know this?
Because no one will deal with them, neither advisers or clients.
Shareholders who are left need to bail out now!
GONE!!
It’s a terrible situation of advisers, but taking the BOLR at any valuation still means you’re selling your business and restraint of trade will apply.
The negotiations with AMP should be to reduce the loan value in line with the revised valuation (I.e. x2.5) – refinance, and leave with the client base.
It’s unconscionable for them to reduce the valuation and not the loan value, and stitch up the very people who have propped up their business for years!
AMP have gone from being a being the leader to being a pariah in the insurance industry.
The current tactics they are forcing advisers to go through are nothing short of barbaric, criminal and gestapo.
Little wonder advisers are committing suicide.
How would the AMP leaders feel if their lives were invaded and put to the torch in the very same manner they are forcing advisers to go through – people who have been loyal to the belief of the big Australian – who is now lining their people up against the wall to shoot them. Seriously, the scum always rises to the top but the chickens will come home to roost and Karma will have its day!
Stealing from clients and consumers, and now stealing from advisers. The big Australian! AMP
Hmmmm ! Seems like AMPFPA has been threatened with AMP “big pockets”. Or the litigation funders have jumped ship. Or AMP advisers are just not up to the fight ! Or its a pre-mediation strategy. Either way – not a good look!
Felix is an exceptionally clever cat.
Maybe he should give away his business as he seems like a generous person.
I wonder what Felix would want for his business if he were to sell it ?
If AMP were prepared to lie to ASIC 20 times there is no way they wouldnt be prepared to lie to their advisers and clients.
If you are buying or reviewing any AMP insurances have a good look at the policy and the start date. AMP have told AMP planners they will be turning off the ongoing trail as it is under grandfathering. This includes underwritten policies.
Good luck with that offer Felix.
Appears you are trying to scam a business in a pressure cooker environment.
That’s your prerogative of course as a buyer.
Offering a multiple of 1x for quality insurance business is an insult.
What are you basing that projection on?…that insurance commissions will be removed entirely on both upfront and renewal retrospectively ?????….give me a break.
Are you planning that ASIC will recommend that all current renewal commissions on all Life Insurance business will be removed entirely and retrospectively and send the whole IFA risk adviser market broke ?
Of Course they’re willing to negotiate, they haven’t got a goddamn leg to stand on, Oliver Twist eat your heart out .. Aka we’ll take whatever you give us, if that’s alright with you guys, what’s that ? await 12 months for a response … yeah cool, right, we’d love to !
I am advising everyone to leave AMP as they have proven they don’t stick to agreed contracts.
Ain’t you a clever cat Felix !
I’ll offer you 0.5 times trail for your book , tops !
I feel for the AMP advisers hoodwinked into this model, however I can’t believe that anyone was still buying trail commission at 4x in the current market.
We are looking at a book that has insurance trail commission in it, I’m going to offer them 1x for it tops and of course the investment trail I’ve removed from the valuation altogether.