DKN offers $3 million to Westpoint clients
Dealer group DKN Financial has offered $3 million “for the benefit” of clients who invested in Westpoint on the advice of its former subsidiary Deakin Financial Services (DFS).
A statement on the ASX today said the offer is conditional upon the DFS creditors “agreeing to a full release of any liability of DKN” at a creditors’ meeting planned for October 12.
In addition to the $ 3 million offer, DKN said it would “also waive its rights to receive any part of $1 million it claims it is owed from DFS”.
DFS creditors will also reportedly be entitled to a $5.75 million payment from DKN’s professional indemnity insurer QBE Insurance Group Ltd.
DFS was placed into voluntary administration in November 2006, with its clients reportedly having invested about $23 million in Westpoint property scheme products.
Administrator Ferrier Hodgson is understood to have received claims from DFS investors in Westpoint amounting to more than $16 million.
DKN chief executive Phil Butterworth said DKN “has no legal obligation to pay this ($3 million) sum but has a moral responsibility to ensure DFS creditors achieve a meaningful settlement of their Westpoint claims”.
If the $3 million offer from DKN is approved, it will have a one-off net profit effect of about $2.1 million for the current half year, he said.
Recommended for you
The new financial year has got off to a strong start in adviser gains, helped by new entrants, after heavy losses sustained in June.
Michael McCorry, chief investment officer at BlackRock Australia, has detailed how investors are reconsidering their 60/40 portfolios as macro uncertainty highlight the benefits of liquid alternatives.
Having reset its market focus to high-net-worth advisers, Praemium’s administration solution has been selected by Bell Potter in a deal that increases the platform's funds under administration by $6 billion.
High transition rates from financial advisers have helped Netwealth’s funds under administration rise by $3.7 billion in the fourth quarter of FY25.
