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TOPIC: AMP Testimony,

AMP Testimony, 6 months 6 days ago #3771

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Royal commission financial advice hearings - live
- 15:11 PM, 13 Apr 2018
45 comments

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Join the ifa team for a real-time rundown of the action as the Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry turns to wealth management and advice.


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Comments(45)
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Patrick D 1 hour ago.
How IOOF have escaped all of this so far is beyond me... are they scheduled to appear at all?
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Anonymous 2 hours ago.
And for our next chapter, AMP meet Shareholder Class Action.
2
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Phillip A 2 hours ago.
Are we seeing a changing of the guard? The findings of the RC will not create a profession, however it maybe an incremental step in the right direction.
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Anonymous 2 hours ago.
Jack's earning his $3 million salary this week
1
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Anonymous 3 hours ago.
What surprises is how the auditors did not review check or qualify the annual statements and filings. Must be a good auditor.
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Anonymous 2 hours ago.
Wouldn't have a job if they did the right checks Id say. Just like the internal compliance department.
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Anonymous 3 hours ago.
Are they going to get onto real advice issues some time of just focus on BOLR. Whilst there are issues there are bigger matters as well
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Anonymous 2 hours ago.
I agree that there are many bigger issues that should be addressed, but perhaps the initial goal here is to highlight the culture that exists within senior management at AMP.
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Anonymous 3 hours ago.
AMPs bureaucracy makes a public service department look like a kindergarten. The real story from these two days at the RC is that ASIC was so concerned drafting incomprehensible SOAs, and rifling through the ex-Guardian advisers advice files to manufacture the allegations of Report 413, that they had no time to go looking for a fees fiasco in the Big Five. Some of these "fees -for-no advice" came from super accumulation in platforms, denuding the balances, just as it said in 413. Where were Mr Kells 60 employees/investigators - down at the Melbourne club, hob-knobing with all the Big Five execs. I can just hear the gossip at the ASIC tea trolley- "we don't need to check-out what is happening at the Big Five- we can trust them, they will always notify breaches, unlike those sleazy self-employed advisers in smaller AFSLs"
1
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Anonymous 4 hours ago.
I've only very recently joined the industry, and the casual admissions/widely known "revelations" that have come to light in these first 2 days are sickening. The 'orphan clients' bobbing around in the 'BOLR pool' are hardworking mums, dads, grandparents etc. all of whom are seeing their retirement funds being diminished & their future jeopardised. They trust advisers and are far too often betrayed - and good God, that is so, so sad.

To those advisers complaining "we are being unfairly targeted" ... How? If the actions of AMP & their employees/authorised reps (and undoubtedly we'll hear of other organisations' horrendous tactics as the RC progresses) don't justify this Royal Commission, then what will?

When i first heard of the Royal Commission, I thought to myself "oh hey, that seems a little unfair." But after this.. bring out the gallows & guillotines. What a dark, shameful era.
5
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Anonymous 4 hours ago.
Hodge v Reagan newmediarockstars.com/wp-content/uploads/2015/06/trex.gif
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Anonymous 4 hours ago.
This is hilarious.
We can't sack the adviser because he or she simply sold the business back to AMP in good faith.
The audacity of the regulator to call a senior manager to task on poor behaviour...LOL LOL !!!
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AMP stymied investigators 5 months 2 weeks ago #3833

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May 4 2018 at 11:00 PM
Updated May 4 2018 at 11:00 PM

My Saved Articles Print License article

Revealed: ASIC accuses AMP of stymieing investigation

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AMP was slammed by ASIC for its failure to produce documents related to a report by law firm Clayton Utz into the fee ...
AMP was slammed by ASIC for its failure to produce documents related to a report by law firm Clayton Utz into the fee scandal. Brendon Thorne

by
James Thomson
Alice Uribe

A furious Australian Securities and Investment Commission accused financial service giant AMP of frustrating and delaying the corporate regulator's investigation into its fee-for-no-service scandal.

In a letter addressed to AMP general counsel Brian Salter and copied to former chairman Catherine Brenner, ASIC says AMP failed to produce documents related to a report by law firm Clayton Utz into the fee scandal, as well as documents related to AMP's Future of Financial Advice Practice Proposition Steering Committee, which was overseen by former chief executive Craig Meller.

"For a number of reasons the investigations team is of the view the AMP's compliance with notices throughout the course of this investigation has been less than satisfactory," Tim Mullaly, the senior executive leader in ASIC's financial services enforcement team, wrote in the letter dated March 18.

"Further, we are concerned that this unsatisfactory compliance, and the misrepresentations as detailed in chapter 3 of the Clayton Utz report … have frustrated and materially delayed the investigation of AMP's conduct since inception."
Brian Salter, who conceded on Monday that his departure was a "necessary part of the process", denied he should take the ...
Brian Salter, who conceded on Monday that his departure was a "necessary part of the process", denied he should take the blame for the way the Clayton Utz report was compiled.

The release of the letter late on Friday by the Hayne royal commission capped another day or drama for AMP, which also named former Commonwealth Bank chief executive David Murray as chairman.
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Ms Brenner resigned as chairman of the AMP board on Monday, the same day Mr Salter left the company.

It is understood that the rest of the board was not made aware of the letter until AMP wealth boss Anthony "Jack" Regan was in the witness box at the royal commission in mid-April – almost a month after the letter was sent by ASIC.

Mr Mullaly's letter details a raft of concerns with AMP's compliance with ASIC requests, particularly around the production of documents.
'Prejudiced investigation'
ASIC accused AMP of frustrating and delaying its investigation into the fee-for-no-service scandal.
ASIC accused AMP of frustrating and delaying its investigation into the fee-for-no-service scandal. Jim Rice

"Throughout the investigation AMP's production [of documents] has been very slow. For example, AMP has taken some five months to comply with a notice issues on October 6, 2017," he wrote.

He also accused AMP of inappropriate redacting of documents "apparently on the basis of relevance or commercial sensitivity" and claiming legal professional privilege (LPP) over the contents of some documents.

"Whilst AMP is permitted to redact documents in order to protect information that is subject to a valid claim, of LPP, there is no legal basis for it to redact documents based on subjective perceptions of relevance, or on the basis of commercial sensitivity," Mr Mullaly wrote.

"These actions have prejudiced ASIC's investigation by depriving documents of their proper context and making it difficult to understand the content of the unredacted portions."

The letter concludes by asking AMP to hand over outstanding documents by March 28.

"We would be assisted in this regard by AMP taking a less technical and more facilitative approach to responding to notices," Mr Mullaly concludes.

The ASIC letter was written in response to an email from Mr Salter to Mr Mullaly, dated February 7.

In it, Mr Salter attempts to argue with ASIC's request to produce full briefing packs from AMP board meeting by claiming that those packs contain materials not relevant to the ASIC investigation.

"You would appreciate that these documents contain information on various topics, much of which is likely to be outside the scope of the subject matter of ASIC's investigation and, accordingly, would not be relevant to that investigation," Mr Salter wrote.

He also outlined AMP's concerns with a number the breadth of ASIC's requests, including its attempts to get the correspondence of individuals inside the company.

Mr Salter oversaw the Clayton Utz report into the fee-for-no-service scandal. The report was supposedly independent, but the royal commission heard it went through 25 drafts as Mr Salter and the Clayton Utz team worked on it.
No 'wrongdoing'

AMP on Friday rejected a suggestion by counsel assisting the royal commission Rowena Orr QC that the company should face criminal charges.

Mr Salter, who conceded on Monday that his departure was a "necessary part of the process", denied he should take the blame for the way the Clayton Utz report was compiled.

"I have not engaged in any wrongdoing. AMP was entitled to seek legal advice from Clayton Utz and work with Clayton Utz in the preparation of its 'fee for no service' report," Mr Salter said in a statement on Monday.

"Clayton Utz has stated publicly that its report and its independence were not compromised. In the fullness of time, I expect Clayton Utz's report will be better understood."

The royal commission also released the explosive Clayton Utz report on Friday. It shows the wealth manager's lack of organisation and oversight was directly responsible for it lying to ASIC on 20 separate occasions during 2015 and 2016.

"From an organisational perspective, apart from certain individual conduct, there is no single cause for each of the mistakes made in the communications between AMP and ASIC," said the damning 86-page report which was finally made public on Friday.

"The mistakes were the result of a combination of a lack of verification procedures, no central team managing communications with ASIC and a lack of proper oversight of the interaction with ASIC."

It said that when AMP prepared responses to ASIC in 2015 and 2016 it relied "heavily" on people with the business to provide information, but did not verify this information.

"Additionally, the individuals involved in preparing the responses to ASIC were not always the same people who had been involved in preparing the prior response and there was a lack of consultation between those individuals," said Clayton Utz.

"In many ways, AMP bears responsibility for allowing the interactions with ASIC to remain in the business, and in the hands of people... who, critically, had no previous experience in dealing with and reporting to ASIC and instead dealt with them as a commercial counter-party rather than a regulator."
Failure to report

There was no dedicated team set-up to obtain information and correspond with ASIC and Clayton Utz said AMP should have undertaken their breach reporting with a more customer-centric "lens".

"The interactions and communications with ASIC became the means by which the business was allowed to formulate a particular narrative without any real scrutiny by an internal independent body," said Clayton Utz.

Key members of the AMP executive team were singled out by Clayton Utz as being responsible for the misrepresentations to ASIC in the 2015 breach report and the subsequent interactions with ASIC during 2015 and 2016.

Managing director of financial planning, Michael Guggenheimer; head of licensee value management Justin Morgan; consultant group executive, advice and banking Robert Caprioli; and managing director, AMP Advice Michael Paff were named in the report.

Clayton Utz said Mr Guggenheimer, for example, failed to take any steps to ensure ring-fencing of of clients was reported to ASIC.

Ring-fencing was a process AMP used to place "orphaned" clients of planners who had retired into a single pool where they were still being charged fees for services they did not receive.

"This failure was pointed out to him during his interview. His response was that he had no "plausible explanation" for failing to do so," said Clayton Utz.
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