OAMPS avoids court with extra NAB custom
Listed insurance broker and financial planning firm OAMPS has softened the impact of a court win against it by National Australia Bank (NAB), by agreeing to remain a customer of the bank for another four years.
OAMPS was a former shareholder in Idoport, the computer systems group owned by John Maco-nochie, whose $50 billion breach-of-contract suit against NAB was thrown out of the NSW Supreme Court in 2002 after piling up costs of $22 million.
Maconochie recently announced he would return to court with financial backing from a hedge fund, but OAMPS offloaded its 15 per cent stake in February.
However, NAB was awarded costs in the original decision, and although OAMPS’ legal advice was that it had no exposure to the Idoport litigation, NAB had indicated it was determined to test this assertion in the courts.
Rather than defend its position, OAMPS has agreed to pay NAB a one-off payment of $2.95 million, and consolidate all its banking business with NAB for the next four years.
OAMPS managing director Tony Robinson said while it was unclear whether the actual legal bills of a new case would have exceeded $2.95 million, the “time and opportunity cost of having this drag on” led the OAMPS board to make the settlement.
OAMPS will make additional payments if the deemed value of its banking business with NAB falls below $1.25 million a year.
Robinson said negotiating the settlement had given him a “very interesting insight” into how NAB prices its services.
Recommended for you
ASIC has released the results of its first adviser exam to be held in 2025, with 241 candidates attempting the test.
Quarterly Wealth Data analysis has uncovered positive improvements in financial adviser numbers compared with losses in the prior corresponding period.
Holding portfolios that are too complex or personalised can be a detractor for acquirers of financial advice firms as they require too much effort to maintain post-acquisition.
As the financial advice profession continues to wait on further DBFO legislation, industry commentators have encouraged advisers to act now in driving practice efficiency.
