Heavy-handed FPA gets slapped by PJC

The Chair of the Financial Planning Association (FPA) was reprimanded by the Parliamentary Joint Committee on Corporations and Financial Services for its handling of the actions of one of the FPA’s directors.

Julie Matheson, who is a director of the FPA, made a personal submission to the Ripoll Inquiry in July this year. In August Matheson received a letter from FPA Chair Julie Berry, stating that in making her submission without reporting to or consulting with the board, Matheson was likely to be in breach of the FPA’s Charter.

Further, the letter said Matheson may have breached her duties as a director under the Corporations Act.

Berry’s letter to Matheson said the board was “entitled to impose a number of measures on directors where there are instances of a breach”.

The matter was to be discussed at the FPA’s September board meeting, Berry said.

The FPA board was concerned that Matheson’s submission did not carry a disclaimer that it was a personal submission, and not one representing the views of the FPA. Berry’s letter to Matheson said “it is clear that some of your views are not supported or shared by the FPA”.

The letter went as far to say Matheson’s “conduct suggests you may have personal interests in a matter or matters where you have acted to serve those personal interests”. The letter said potential conflicts between a director’s personal interests and their duties as a director must be notified to the board, “and in certain circumstances you may be required to resign”.

“In addition you make disparaging comments about FPA members,” the letter stated.

The letter said Matheson is “not required to agree on all matters with other Directors or the Board”, it also essentially said this fact does not allow directors to make public statements in conflict with the board’s stated opinions.

The letter from Berry to Matheson was brought to the attention of the Chair of the inquiry, Labor MP Bernie Ripoll.

In September Ripoll wrote a letter addressed to Berry in which he advised Berry that the correspondence “may constitute a contempt of Parliament and a criminal offence on your part (as the person who signed the letter), as well as on the part of other senior FPA personnel who were party to the decision to write to Ms Matheson in these terms”.

Ripoll said the relevant Parliamentary resolutions included interference with and molestation of witnesses.

“Such action may also constitute a criminal offence under Section 12 of the Parliamentary Privileges Act 1987. Penalties may include fines or imprisonment not exceeding six months,” Ripoll’s letter states.

Ripoll’s letter went on to warn of the implications of “threatening, disciplining or otherwise disadvantaging Ms Matheson in any way” that may be linked to her submission or any dealings with the committee, with any further action to be subject to “further action by the committee and possibly by the Senate”.

Ripoll asked that the letter be withdrawn unreservedly, and for the proposed review of Matheson’s conduct at the September board meeting to be called off.

The next day Berry confirmed to Ripoll that both of those directions would be followed, while also committing that Matheson would suffer no disadvantage as a result of having made a submission to the inquiry.

On the same day Berry wrote to Matheson extending an apology, saying “it was never the intention of the FPA to hinder you giving a personal submission to the committee”.

In the final report handed down by the committee on Monday, Ripoll said the committee “considers this to be a serious incident”.

“However, the committee has concluded that the purpose of the parliamentary privilege resolutions, which is to protect witnesses, has now been fulfilled.

As such, the committee does not consider any further action in relation to this matter is warranted.”