AMP in the gun over misleading securities and investments commission
BELEAGUERED wealth manager AMP has lost its chief executive and had more than a billion dollars wiped off its share price — now it could face criminal charges.
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BELEAGUERED wealth manager AMP has lost its chief executive and had more than a billion dollars wiped off its share price — now it could face criminal charges.
The banking royal commission heard yesterday AMP deliberately misled the Australian Securities and Investments Commission over the charging of financial advice fees for no service on 20 occasions.
It also heard yesterday that Commonwealth Bank, Westpac, NAB and ANZ may have been guilty of misconduct over various issues related to providing financial advice to customers.
Commissioner Kenneth Hayne QC was told he could make a series of misconduct findings against AMP over the issue which saw AMP chief executive Craig Meller resign last week and more than a billion dollars wiped from AMP’s share price.
The misconduct could include management and the board’s role in changing a supposedly independent report to ASIC about the matter.
It went through 25 drafts with some of the changes made by chief legal counsel Brian Salter, former CEO Mr Meller, head of advice Jack Regan and chair Catherine Brenner, the inquiry heard.
“The effect of some of those mark-ups or suggestions by Mr Salter appear, on their face, to be to limit the findings as to the extent of the knowledge and involvement of the most senior executives,” senior counsel assisting the commission Rowena Orr QC said.
She outlined a series of possible findings against AMP, including criminal penalties for breaches of the Corporations Act.
“The senior management and executives who contributed to the misleading of ASIC over the two-year period had knowledge of the extent and nature of the conduct and were warned by junior staff about it being a breach, but continued with a misleading narrative to ASIC,” Ms Orr said.
ROYAL COMMISSION WITNESS COLLAPSES ON STAND
NAB ADVISERS FALSIFIED SIGNATURES
Ms Orr said it was open for Mr Hayne to find the conduct in relation to the independent report by Clayton Utz amounted to misconduct, noting the criminal penalties that apply under the Corporations Act.
“Having regard to the changes made to the report, there is a reasonable basis for concluding that AMP, by one or more of its senior employees or officers, knew that the representation that the report and the findings made within it were entirely independent, was materially incorrect,” Ms Orr said.
But the other big financial institutions were also in her sights. Ms Orr said the commission could find the Commonwealth Bank may have breached multiple provisions of corporate law in its fee for no service conduct and that NAB advisers falsely witnessing death benefit forms might have amounted to misconduct.
She said Westpac may be guilty of misconduct by failing to take reasonable steps to ensure its advisers complied with the law, and some of ANZ’s former financial advisers could be guilty of misconduct for providing improper financial advice.