Ampfpa CEO Neil Macdonald said, “AMP is on the record saying it is trying to right some of the wrongs of the past – it cannot right wrongs by doing the wrong thing by its own people.”
The association has surveyed member practices about the action they want to take and received a response rate of over 90 per cent. Of those who responded, over 93 per cent indicated they support legal action.
“To that end, ampfpa has arranged legal packs outlining the available options for its members and is seeking additional information from them,” Mr Macdonald said.
“We are aware that tier one legal firms are prepared to run a class action against AMP and funders are available at very competitive terms. Our members intend to hold AMP accountable for the severe financial, reputational and psychological harm it is inflicting on its own advisers.”
On 8 August 2019, AMP announced that it intended to cull its adviser network and slash the amount it would pay under its buyer of last resort (BOLR) terms to exiting advisers from four times recurring revenue to a maximum of 2.5 times.
“This action was taken without consultation with ampfpa, without the required 13 months’ notice to advisers, and after AMP assurances that existing BOLR arrangements would not change,” Mr Macdonald said.
As recently as May 2018, AMP Financial Planning’s then managing director met with AMP practices around Australia to reassure them that prevailing BOLR terms would remain the same.
“Based on this assurance, many practices may have made a decision to stay on with AMP last year, rather than exercising their BOLR rights,” he said.
Ampfpa has prepared an issues paper on behalf of its members, as well as member questions for AMP. Ampfpa has invited AMP senior management to attend an afternoon meeting to be held later this month with advice practices staying on with AMP.
The association has also written directly to individual members of the AMP board of directors outlining ampfpa’s concerns. This letter followed two previous letters that ampfpa sent directly to each individual member of the AMP board on 5 August 2019 and 7 August 2019, both of which were ignored.
“The response we received to the third letter came from AMP management and does not inspire us with much confidence,” Mr Macdonald said.
He said ampfpa objects to suggestions that the advisers currently being culled by AMP are those who will not be able to meet new compliance obligations or will not be able to transition to a fee-for-service practice.
“It has been reported in the media that AMP has identified practices that won’t make it through the transition because, ‘their business economics simply aren’t strong enough’. In our opinion, what this actually means is that AMP thinks they cannot profit from these practices and so is organising their exit. This does not excuse AMP from honouring the agreements it has with these practices and the BOLR terms that were in place before 8 August 2019.”
Mr Macdonald said ampfpa is aware that members are contacting their local members of Parliament and small business ombudsman offices in their home states to air their concerns.
“Several ampfpa members are actively pursuing these avenues,” he said.
Amazing you google searched a court case
Well done bro
[quote=Devil’s Advocate]AMP can lose and I refer to Avis V Australian Mutual Provident Society dated 21/12/1995 where AMP tried to screw Gary Avis and Chancellor Investments Group Pty Ltd. It was a test case by a large company aggressively trying to stomp on a smaller company and renege on agreements. Interesting reading. It was a messy and lengthy court case but the smaller company prevailed and costs were awarded against AMP. [/quote]
Neil and the AMPFPA Board can’t change a thing. Lots of little roars going nowhere. Wade and Fiat will do what they want, get their bonuses and move on. AMP is one and the AMPFPA has been gone at least 2 years. Goodbye Neil and Chairman of the Board.
It’s dejavu….I remember when AMP was a sinking ship back in 2000, with low share price and losses (UK investment with Henderson’s etc) and Mr George Trumble from USA came to the rescue. Only to be given a golden handshake of millions of dollars a few months later (the largest in CEO history in Australia at that time). The rot really started then and it is no better now. This might just be the plug that needs to be pulled out!
Neil and the AMPFPA board have done nothing for the last two years. The worst-case scenario is that Neil and the board have actively shafted advisers. The best-case scenario is that Neil and the board are hopelessly incompetent.
Interesting the entire AMPFPA board have been invited to stay on with AMPFP and benefit from the influx of low-cost client bases. Things that make you go Mmmmmmm!
Good luck ampfpa I pray that this acts as a catalyst for sending this monstrous company into oblivion.
Nothing will happen…..like hell! It’s in the Agreement to buy back at 4 times. AMP will get slaughtered legally then they will rot slowly as clients continue to bail out and advisers will correctly, refuse to deal with it.
AMP will finally get what it deserves.
Thsi is a great opportunity also , in the same breathe , to sue AMP for the reduction / refusal of sales of registers under the ” Compliance ” excuse . Well worth testing . I will happily pay my share to hear the local Compliance officer under Oath about what they were directed to do and say .
Does Ferrari go home with his tail between his legs ??
Great , the membership got a vote on an important topic .Now that’s what i call democratic . Heed this FPA , I was a member for 26 years and got to vote on NOTHING !!!! Nothing was sent to us to vote on , A dictatorship at the highest level . Time to step down Dante !!!
Take them to the cleaners. Amp may as well sell its investment and banking arms and whatever other assets they have left. Use this to pay every amp adviser what they were promised, give a 100% capital return back to shareholders and close up shop. Amp was built on a trusted brand, its no longer that.
Anon adviser: Like you I’m not effected by this, but you don’t seem to give a shit about your fellow planners and how AMP don’t give a crap that they might have got them there in the 1st place. This is there lively hood that where talking about and they need all the support they can get from all planners. So if you have nothing positive to say then piss off.
AMP advisers need to negotiate an exit to the non aligned dealer space. Move now and build a businesses rather than relying on a bank, the insurer or the product provider to buy your business on an inflated multiple.
It’s over. Forget about thinking your FP business is worth anymore than 1x revenue with a whole lot of conditions and claw backs attached to it.
If you’re getting 2x, throw yourself on the ground and praise the lord!
This industry is ridiculous. Wouldn’t wish this on anyone as a profession.
That’s because AMP are Corporate thieves and management is a bunch of liars!!! They will do whatever they can to get client books devalued unfairly to pay as little as possible to restructure at their own advisers expense and heartache.
AMP can lose and I refer to Avis V Australian Mutual Provident Society dated 21/12/1995 where AMP tried to screw Gary Avis and Chancellor Investments Group Pty Ltd. It was a test case by a large company aggressively trying to stomp on a smaller company and renege on agreements. Interesting reading. It was a messy and lengthy court case but the smaller company prevailed and costs were awarded against AMP.
[quote=Anon adviser ]Nothing will happen. AMP are pulling out all the stops here. Pack it up Neil and ampfpa, it won’t change a thing![/quote][quote=Anon adviser ]Nothing will happen. AMP are pulling out all the stops here. Pack it up Neil and ampfpa, it won’t change a thing![/quote]
Nothing will happen. AMP are pulling out all the stops here. Pack it up Neil and ampfpa, it won’t change a thing!