More delays pile up for AMP BOLR settlement
The case management hearing for the Federal Court to approve the final sum for the AMP BOLR class action has been delayed for the third time.
Originally scheduled to take place on 22 December, it was postponed to 21 February and then delayed for a second time before a new date was set as 21 March.
However, Federal Court listings show this has been now delayed yet again to 12 April.
It was announced last November that AMP would pay victims of the BOLR class action some $100 million following a verdict by Justice Mark Moshinsky in July 2023. This was double what the firm had made a provision for in its H1 2023 financial statement and followed mediation by the parties.
The parties will also need to decide what the sum means for each of the individuals in the class action and how it will be divided up.
At the time, the sum was welcomed by Neil Macdonald, chief executive of The Advisers Association, who said he hoped it would bring closure to the affected advisers, who are represented by law firm Corrs Chambers Westgarth.
“Taking matters to court is a long process, often difficult to understand, expensive and stressful. We extend our heartfelt thanks to our members for their enduring patience, which helped pave the way to this outcome.
“The settlement still needs to be approved by the court, and what it means for each member of the class action individually still needs to be worked out by Corrs. What we can say at this stage is that it provides some closure and allows all concerned to look to the future."
Commenting on the latest delay, class action member David Hasledine, said: "I'd be more inclined to take this latest delay as a positive. AMP and Corrs are using this time to pull together arguments that will convince the judge that the settlement is fair and reasonable.
"On the balance of probabilities my guess would be that they are having trouble doing it and that's why we have seen yet another delay. Keep in mind that it is not in AMP's or Corrs' interest to drag this out, it is supposed to be a done deal."
The class action was filed in the Federal Court in Melbourne back in 2020 on behalf of advisers who had been authorised by AMP Financial Planning (AMPFP). The claim related to changes made by the firm to its BOLR policy in 2019. This had seen AMPFP cut its BOLR terms without notice from 4x recurring revenue to a maximum of 2.5x.
The verdict on the class action was issued by Justice Moshinsky on 5 July, ruling that the changes made by AMP with immediate effect were not authorised under the legislative, economic or product (LEP) provisions and “were ineffective”.
Announcing the settlement sum, Alexis George, AMP CEO, said: “This is an important step for our advice business and for AMP more broadly as it allows us to put this legacy matter behind us, which has impacted relationships with our valued advisers.”
Money Management has contacted Corrs Chamber Westgarth for comment.
AUTHOR
Laura Dew
Recommended for you
Following an extraordinary general meeting today, Dixon Advisory parent company E&P Financial Group’s shareholders have voted on its proposed delisting from the ASX.
While overall financial adviser numbers have dipped below 15,500 this week, Rhombus Advisory is experiencing growth and approaching 500 advisers in its ranks.
Iress’ Xplan continues to dominate the financial planning software market with a multitude of uses, according to Netwealth research, despite newer players battling for a piece of the pie.
ASIC has shared the percentage of breach reports related to financial advice in FY24, noting increased reporting by smaller AFSLs.
No surprises here!
First AMP destroy Advisers businesses, then AMP destroyed advisers financially by terminating planners causing anxiety and depression, now they won't even pay out the true value of the businesses they destroyed, all while smiling and saying we have changed and we want to put the legacy behind them. If this was the case they would stand up, admit they were wrong and pay the adviser the true value of their businesses with further compensation for pain and suffering they caused. Come on AMP do the right thing for once, only them will anyone really believe you have changed your ways