Mr De Ferrari said that the move to reduce guaranteed values in its BOLR contracts from four times to 2.5 times revenue, as well as terminate 250 planners that were no longer profitable, was a “challenging decision” but that AMP’s position “was the right one”.
But Neil Macdonald, the CEO of the Adviser Association, says that “the commitment was on the contract”.
“Fundamentally, AMP changed the contract without adequate notice and without consultation,” Mr Macdonald told ifa. “Obviously the members feel as though they’ve got a legal argument that AMP can’t do that … the members are saying they didn’t give 13 months’ notice and they didn’t consult with us as an association.
“We think, to be honest, if they had consulted we would have been able to come to a workable solution that achieves their objectives and our members’ objectives.”
Mr De Ferrari also said that AMP’s aim was to arrive at having practices that work with the company, and which are compliant, productive and professional in servicing clients.
“They still have not come out with what their future business model looks like for advisers or for advice,” Mr Macdonald said. “They are currently working on that and obviously they will engage with us in that.
“The question is ‘what does work with them mean?’ For advisers, they’re increasingly in a BID world, and so to work with any product manufacturer you need to be able to demonstrate BID. So, unless their products are competitive, and put clients in the better position, you can’t actually work with a provider.”
A financial planner’s business should not need to rely on any institution to buy their business for a set price. This is why the industry is in the state it’s in. Take responsibility for own business, the valuation of it will be determined at what it’s worth at a market value and not some hair brain scheme to keep financial advisers chained to the institution. The regulators should have outlawed this years ago.
Agree
AMP do not want to ‘work with’ planners, they want to dictate, bully and harass them to the point of breaking. There is no trust left in AMP with the planners due to their actions and clients are wanting to see them pay for the despicable treatment of their trusted adviser. AMP may own the client based on a contract, but the clients will make their own decisions based on how they have treated the planners that they deal with face to face and trust more than some brand that may appear on a statement.
It would be great if the Senior Executives and the board actually read some of these comments they could possibly then get a feeling of what the broader adviser population and their own advisers think about what Mr Ferrari and the Board is doing to a once great Institution, slowly but surely bringing it to its knees, Rod m
AMP is merely doing to it’s ‘advisers’ (agents – who worked for them) what they’ve always done to their clients/members – screwed them! Many of those same advisers/agents were responsible for screwing their clients with AMP products for years…which none would ever use now…(which shows how much they really thought of those products all along). That’s always been the problem with vertically integrated businesses – but never more so than when “advice” is purpotedly being given about products manufactured by the company’s web of businesses. What could possibly go wrong? And how could anyone have trusted AMP in the first place…or why? They’d proven themselves over many decades. Those of us looking in from outside reckon it’s not even ironic – but it’s actually justice.
Put your name to your comments you potato. You obviously don’t have a clue of the advisers involved in this and the priority to place the clients in a better position rather than screwing them as you say. You have no idea of the exit terms been given to the advisers, the debt they are in and the associated mental health issues that have occurred so maybe you should focus on AMP’s wrongdoings at higher management level than the advisers who have always looked after their clients.
Very true.
Keep the fight going and AMP like ASIC needs to do the ‘ethical coarse’
Hi just wondering why you don’t put my name next to my comment thank you Rod magill
Slide deck only talk about advisers until somewhere in the middle, with remediation as focus. They are going to jettison the personal advice business within 24 months, double down in funds management, platform and AMP Bank. I think they will sell it to Count or Centrepoint.
Nice one Neil!
Only if they paid out the advisers the 1.5 times originally agreed too, maybe from the proceeds from Life insurance sale to Resolution, and I don’t think they will have this problem.
Now they have an adviser force, which was responsible to writing most of their business, hating them and now writing new and possible existing business with any other provider besides AMP.
Well done De Ferrari, Wade and the like, you have sent an ‘iconic’ Australian with over 150 years to destruction, and your legacy (when you all leave in the coming 5 years) would have been to destroy AMP completely.
I as a shareholder, are not be happy with this model and the ‘experts’ running the show and blame the gutless board for panicking and employing these Toe cutters. In 5 years, the shareholders and whatever shell of AMP will be left with close to zip value, whilst these pirates will move on, wealthy then before setting their teeth into AMP, to another corporate entity somewhere in the world……
The shareholders need to remove the board………
De Ferrari & Murray have treated small business owners with contempt. The fact that they believe that harrassing and bullying is an acceptable form of business is disgusting. They should be ashamed of themselves.
There’s that comment again. “Work with them”. BID and FASEA say that a conflict of interest should be avoided. If I worked there, I would not like to think I had to “manufacture” a way to prove BID is OK with a conflicted product.
AMP advisers are barking up the wrong tree trying to overturn the BOLR changes. AMP is morally & legally in the right to change BOLR (apart from some minor notice period quibbles). There is a good chance AMP will win.
Where AMP was clearly in the wrong, was overcharging new advisers for poor quality client registers, regardless of any perceived “BOLR safety net”. Surely this is the issue advisers should be pursuing in the class action. They should be arguing for partial refunds of their purchase price, not reinstatement of old BOLR conditions.
If the BOLR changes are overturned, it won’t be just the overcharged new advisers who benefit. It will also be the older AMP advisers who offloaded their C & D clients onto new advisers (via AMP) at inflated prices in the first place. What a perverse outcome that would be.
AMP has the right to change the terms, however they need to provide 13 months notice before the new terms come into effect. Thus 13 month period gives advisers the choice to accept the new terms or lodge their bolr notice. AMP in this instance made the changes immediate, hence why now they are being sued.
Exercising BOLR within a 13 month notice period might be OK for advisers who were planning to exit the industry anyway. But most newer advisers want to continue their careers in the industry. They don’t want to be subject to the 3 year exclusion that BOLR entails. This is why the “reinstate BOLR” approach serves the interests of older advisers far more than the newer advisers who are being used as frontline troops to fight this battle. Newer advisers need to be refunded for their overpriced purchases. They don’t need an early retirement scheme.
Oh really, so those exiting advisers, who were tied into a closed market for decades just have to cop it on the chin? Piss of you moron
What if there is no money at AMP? What then?
“So unless their products are competitive, and put clients in the better position, …” Is it 10 years late for this insight?
my only regret is we see no interest from those very politicians that lifted the scab on AMP – to keep digging and find out how they are treating the AMP adviser ( the small business owner) Every thing that is wrong with B2B dealings of bad behaviour and bullying can be found with AMP hierarchy. Great place to stamp it out.
I really have no interest in what Kneel Macdonald says anymore.
Too little, too late.
I hope the class action is successful regardless of the involvement of the AMPFPA (aka the ‘Adviser Association’).
Why comment then??? The Association has done a pretty good job considering the position AMP put them in.
” work with the company” means exactly that.
We will control you, we will own you, you will do it our way and you will build the company’s wealth through utilising our product range at every conceivable opportunity.
If you do not play the game, we will come for you and we will destroy you.
That’s what it means.
Is Dr Ferrari implying that terminated practices were not compliant, not profitable (to AMP) and not professional? What a kick in the guts to planners that supported amp over all the scandals and that are now kicked out like stray dogs? Another class action for deformation perhaps?
Call it for what it is. It is theft of $800,000,000 dollars from small business people. Their conduct is unconscionable and the 4 executives and the Board should be worried they will eventually face criminal charges and jail time.