Yesterday, ifa reported that the corporate regulator has initiated Federal Court proceedings against AMP Financial Planning for alleged breaches of the FOFA best interests duty.
Subsequently, an AMP spokesperson told ifa that the embattled wealth giant intends to file a defence in “due course” and will be co-operating with the corporate regulator in the interim.
“ASIC has today commenced proceedings in the Federal Court against AMPFP in relation to historic conduct by advisers who engaged in the practice of replacing, or ‘rewriting’, life insurance policies of clients,” an AMP spokesperson said.
“ASIC’s pleadings in particular identify the conduct of a former AMPFP adviser, Rommel Panganiban, who engaged in insurance rewriting.
“AMPFP removed Mr Panganiban’s authorisation in 2014 and reported his conduct to ASIC. Mr Panganiban was subsequently banned by ASIC in 2016.
“AMP is apologising to the customers impacted by Mr Panganiban’s actions and they are currently being compensated.
“We have continued to enhance our monitoring and supervision activities to monitor the writing of new insurance policies.”
An ASIC spokesperson has subsequently confirmed to ifa that the court proceedings related to a total of “six contraventions”.
AMP has described the conduct in question as “historic” but ASIC’s statement alleges the behaviour occurred in 2013 with an investigation commenced in 2014.
In May 2016, the Federal Court dismissed an application from Mr Panganiban seeking an order to restrain ASIC from banning him.
The proceedings come as AMP faces criminal charges over alleged illegality uncovered by the royal commission, including making false and misleading statements to ASIC.
AMP you are a disgraceful organisation that should be history, your conflicts have been known to all planners.
I have never recommended your products and as an adviser think your Ownership of clients and the way you buy and sell registers is shocking and should be banned,
Thank you Philip, you are correct. Every industry, Doctors, Lawyers, Judges, Police, Financial Advisers have a percentage of dishonest or challenged members. Time / education will not change that. Instead of attacking the institutions, and the people that oversight the ‘sales’. We need to be aware of how we promote and see our industry to the outside world and ourselves.
problem with our current position is that we have the FPA and the AFA “promoting” our industry to the outside world
they are incompetent organisations and full of incompetent people and we are a disaster as an industry. if you think otherwise you are kidding yourself
the vast majority of advisers have vehemently protested the educational reforms via FASEA yet that is the foundation stone we desperately need to become a profession.
there are too many self serving self interested people in this industry who think only of themselves before putting the profession and clients ahead of themselves. until this industry is rid of these types of people we will never become a profession
Nailed it.. Too many holding onto the past of low level of entry and no-compliance sales culture. Hopefully FASEA and exam culls most of the herd, especially those still stuck in the 70’s, 80’s and 90’s.
i reported one of their advisers for ripping off a customer, only to have nothing done
they deserve what they get.
ASIC is a cop on the beat; poorly paid (funded) and few in number, so it can ONLY catch people AFTER the event sometimes. Stop blaming them and start directing your anger at those who call themselves advisers and who have made a laughing stock of us all. AMP in this case are as much to blame – take a look at the commission structure and you’ll see that AMP also benefits from churning because it also gets a new, higher fee, rather than the lesser rolling fees on older products. Think before you write. Take responsibility for your industry/profession and caste the blame where it belongs. Tell the government to better fund ASIC (unless you prefer it to remain underfunded and unable to properly regulate – as those such as AMP do!). Oh, and use your names, you cowards.
Sure, a better funded and more assertive ASIC would be helpful but we now know from the RC that the main cause of the problems is at the Licensee level.
Phillip, the previous head of ASIC has said on several occasions that their approach is to turn up AFTER the accident and NOT before or during. Their approach has been made quite clear, they’re not the cop with the speed radar..they’re only the accident investigation team. What’s needed is not extra funding but a change in thinking on their behalf. Advice is too costly to deliver now without extra ASIC levies (we’ve seen legislation passed in March coming in shortly). What’s also needed is greater self regulation & not Government intervention. Why have the FPA not expelled AMP? (Funding is the reason). Advisers need to tell professional associations to end their tires with product manufactures and advisers themselves need to look at their relationships with these firms. Advisers should be thinking who they are licensed through. FASEA is a classic example of what happens when we fail to self regulate.
Leadership, culture, corporate governance is set from the top. AMP is rotton to the core. Inaction by ASIC, a flawed licenscing system, sales above service have not helped. This is all a culture which has become clearly evident in the behavior we’re seeing from Advisers in those firms.
Is AMP trying to pass the buck. Do they not know they are responsible. The management are not aware of their duties and now cry. Sales people should not be in charge of planners-only qualified with high level planning degrees plus ethics, corp law etc, the same as planners. Wake up management, look at other practices, lawyers, accountants, doctors. The sales regime is dead and when that is realised, we may become a profession. Watch other big guys start to panic.
Agree. All AFSL management without a decent business degree, FP qualifications and advice experience have to go. They are the problem.
Of course AMP is trying to pass the buck. But they’re stupid if they think that ASIC brought this action without enough evidence to prove the problem is systemic. Losing wouldn’t be smart for ASIC as their credibility problem is as big as AMP’s at the moment. ASIC is escalating with all the majors post Royal Commission. The days of negotiated settlements, EU’s & throwing an advisor under a bus are in the past. AMP is finally being held to a standard of corporate accountability. The other big guys should be worried.
So lets understnad this. AMP advises ASIC of this dummy adverser doing the wrong thing. ASIC takes action 2 years later. Wow, thats fast service from this incompetant regulator. In fact, this whole industry is run by some very foolish people who do not have the best interest of the consumer in mind. Driven by self interest, arrogance, incompetance and lead by idots in politics on both sides, who try to carve out a benefit for either the union movement of large banks, is it any wonder why our industry is a mess and the consumer has little confidence left. Wake up folks. ASIC to the rescue ? They still are the first to create problems and the last to discover problems. How many investors have lost money and how may advisers have been kicked and continue to be kicked when they have run an honest business. Fools leading fools.
ASIC has finally had to grow a set after the Royal Commission. No more EU’s, it’s hi ho, hi ho, off to court we go
Yep and CBA claimed their money laundering issue was the result of a single coding error. See how that worked out for them $700 mil later