According to a Fairfax Media expose published on Saturday, the financial planning behemoth chose not to report one of its senior staff members to ASIC after it discovered they had been involved in insider trading during an internal investigation in 2009.
Instead, IOOF dealt with the staffer internally and made them donate the profits they had obtained to charity, said the media report, adding that this was just one of a raft of improper practices within the institution.
However, in a statement to ifa, IOOF rebuffed these claims, saying that the firm had indeed notified the regulator and that the issues had now been resolved.
“All the issues raised, historic or recent, have been dealt with appropriately at the time. This includes, where relevant, through internal and board review, notifying industry regulators, ongoing review of compliance measures and controls, employee education and independent investigations,” an IOOF spokesperson said.
“Most of the claims appear to have been promoted by a former employee who is in a legal dispute with the company and are historic in nature.”
The Fairfax Media report quoted a former IOOF employee who confirmed the insider trading and that it was resolved in-house
ASIC refused to comment directly on the case, but said there was regulatory guidance regarding research report providers and suspicious activity reporting.
“Licensees have an obligation to report significant breaches and market participants have an obligation to report information which may raise a warning signal of market misconduct,” an ASIC spokesperson said.
IOOF maintained that it has had a strong compliance record and client satisfaction, and has always acted in the client’s best interests.
“To the best of our knowledge and based on reasonable enquiries, none of the issues raised in the article will cause any loss to any IOOF client, past or present,” the statement said.
Despite these claims, some in the industry have resumed calls for a royal commission into the entire financial planning industry.
On Saturday, CBA whistleblower Jeff Morris tweeted at the Prime Minister Tony Abbott in response to the Fairfax Media report, demanding a royal commission be established.
IOOF said it would continue to investigate any matters that came to its attention.
“Some of the claims relate to legal matters which cannot be canvassed in public at this time therefore IOOF has no further comment,” the spokesperson said.
Tip of the iceberg at Macquarie as well – practices there are much worse. Lets see who they go for first? Its who you know , not what you know there!
Tip of the Iceberg – I promise
A RC would stop this industry for a year. Be very careful here. Governments only hold RCs when they know what the problem is, and write Terms OF Ref accordingly. Often the result is binned, but reputations are trashed. Evidence is NOT tested to Court Standards, and subsequent DPP actions often fail. See ICAC.
Just some things I’ve noticed:
1. The headline – “IOOF’s Boiler Room throws customers to the wolves” – the allegations run thick and fast in the IOOF Boiler Room.
This is a complete lie. Nothing in the article suggests customers were impacted, nor was there a ‘boiler room’ – ie, cold calling investors to buy penny shares in a scam.
The article is full of innuendo, and ‘concerns’ over 7 year old, and 17 year old! incidences involving 2 employees in a company of thousands.
The aggrieved staff member had his complaints dismissed by 2 independent bodies – Pricewaterhouse Coopers, and the Fair Work tribunal. How an equity staff member hired in May 2014, already has access to personal emails, HR files, audit reports, adviser emails etc, going back 2 decades is of interest – he would have been barely been off probation yet somehow has gained access to every email and risk report and confidential HR file.
Do you actually know what a royal commission is and what it entails?
There was no mess and all issues were handled internally and correctly. When an employee resigns or is terminated, that employee has no right whatsoever to steal documentation that does not belong to him. Passing on stolen documentation that could be sensitive, should lead to incarceration. Ms Ferguson has created this mess by writing an article that is not only disjointed but insults financial advisers. For those of you who relish in others misfortune, read what she wrote in the SMH carefully. The same article was published in the FinReview but without naming names. A real piece of work and frankly I am disgusted with this gutter journalism. I have been practising for over 34 years and I have had a gutful of sensationalists who think it is their god given right to twist a story to such a degree, where it becomes harmful. IOOF shares drop almost 20% in value today purely on this mealy mouthed article.
Sure leo. Maybe do some research before calling for a royal commission. Getting sick of this “nothing to hide” crap. It’s all getting rather boring and predictable now. Journalism is dead, in fact I don’t think they should be allowed to use that term any more, it’s misleading.
Bring on a royal commission. I’m sure Planners have nothing to hide. If the institutions have nothing to hide they have nothing to worry about. We should all welcome transparency.
Of most concern in the article is the executive named who jumped from a sinking ship after having been at the head of a large Institution when a large number of wrong-doings occurred. This executive at the very least needs to be held accountable given their current position of influence in the industry, and more importantly the fact that the front-line planners at every single practice around Australia that have stuck to professionalism from day 1 have copped it from all sides in the media and from ‘showbag Shorts’ and his cronies.
few insto fellas commenting here i see? hot under the collar? once again scandals within the vertically inetrgated are exposed and advbisers shoot the meessenger instead of the ppl that caused this mess. pathetic
Yes, I vote for a royal commission into the journalism industry. I hope Adele didn’t hold a short position on IOOF before going to print. This is getting plain ridiculous and I can only assume Jeff Morris is getting slack with his research also.
Yes Adele ferguson – anyone actually know what her beef with the industry is? Did she date a planner who ditched her and now is full of p*ss and poison?
Would love someone to hire a PI to see how squeaky clean she is or if there are skeletons in her closet, and remove this clearly biased nonsense.
Seems like she is trying to carve a niche by being an aggressor in this area and as per journo trends create sensationalism as ‘blood sells’.
Adele and Jeff need to get past 2006. Maybe a Royal commission into mis-reporting ? Also anyone actually buying the SMH or Fin lately ?
Thank God for Adele Ferguson. If it hadn’t been for her thousands of CBA customers may not be getting compensated for dodgy advice. When are we as an industry going to start thinking about the clients rather than our own self interest? Possibly after a Royal Commission to clean this mess up. Bring it on.
Who are these people calling for a royal commission? Adele Ferguson and Jeff Morris and…? I guess instigating a royal commission to satisfy two people is normal in this world we live in.
Royal Commission ? Whist I respect Jeff initially, I am beginning to tire of his voice on these matters.
Don Nguyen might have had a negative effect on the finances of some of his clients, but he’s been an absolute goldmine for Adele Ferguson.
How many times can she dredge up some unrelated corporate infraction, and use it as an excuse to run the Don Nguyen story over and over again, with Jeff Morris reliably chipping in from the sidelines?
Sorry Jeff, we know you got a bad deal from CBA and ASIC, but Adele is using you to try and destroy the whole financial planning profession. Is that what you really want?
Please note that the reporting journalist is Adel Ferguson. Information appears to be historical and full of innuendo. Never let the truth get in the way of a good story eh? IOOF shares have fallen 10% because of questionable journalism. This is not the first time that she has written damaging incorrect exposes. IFA you should make some investigations yourself rather than lifting already published information
A royal commission on the back of a journalists opinion?
Would a royal commission into journalism be more appropriate?
No offence IFA, just saying