Class action looming against AMP Financial Planning
Shine Lawyers has indicated it is about to hit AMP Life, AMP Financial Planning and its subsidiaries, Charter Financial Planning and Hillross Financial Planning, with a class action.
The action to be filed in the Federal Court will claim that AMP Financial Planning through its authorised representative and companies breached its fiduciary and statutory duties to an estimated 100,000 clients by failing to provide objective financial advice, failing consumers’ best interests.
The firm has alleged advisers employed by Charter and Hillross received commissions and other incentives to recommend insurance through AMP Life.
Shine Lawyers will further claim that AMP Life was in knowing receipt of gains made by the sale of inflated insurance by the AMP financial advice licensees and their authorised representatives.
At this stage, Shine has said it is in the midst of investigating the charges, but it is set to "imminently" file the claim.
The launch will take place following the wealth giant being freshly hit with a $5.18 million fine for failing to prevent its advisers from conducting insurance churn.
AMP’s Financial Planning Association has also just merged with Hillross Advisers Association, forming The Advisers Association, a body to represent both licensees. Members voted for the amalgamation at annual general meetings last week.
Speaking on the class action, Shine’s head of litigation and loss recovery Jan Saddler said the advisers recommended AMP policies despite knowing their clients could obtain equivalent and better insurance with lower premiums through other providers.
“AMP has encouraged and incentivised its financial advisers to prioritise personal gain above their professional obligations,” Ms Saddler said.
“The clients, who should have been AMP’s primary concern, have been financially disadvantaged as a result. It’s unacceptable that hundreds of thousands of Australians who thought they were getting objective financial advice have instead been ripped off.
“AMP Financial Planning and its authorised representatives have breached the trust of clients who relied on their advice to make decisions about their personal insurances.”
She added that clients slugged with excessive premiums deserve to be compensated.
Consumers are being called to participate if they obtained an MP Flexible Lifetime Policy, which includes death, TPD, trauma, income protection and business protection insurance, from 2013 on the recommendation of AMP Financial Planning, Charter Financial Planning and Hillross Financial Planning.
The class action is being funded by Woodsford Litigation Funding.
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