Banking royal commission: AMP may face three class action over revelations

Three law firms say they are poised to launch class actions against AMP, amid more revelations at the banking inquiry.

Quinn Emanuel partner Damian Scattini. Pic: Darren England.

Scandal-hit wealth management icon AMP has been hit with the threat of three separate class action suits in the wake of shocking revelations of misconduct at the royal commission.

Class action specialists Slater and Gordon, Queensland-based Shine Lawyers and global law firm Quinn Emanuel Urquhart and Sullivan all announced on Monday they were poised to pursue the $12 billion ASX-listed AMP over the company’s alleged withholding of information from investors.

AMP (AMP) declined to comment on the news.

The financial services royal commission has already carved $1bn off the company’s market capitalisation and prompted the early exit of chief executive Craig Meller.

Shares in the company fell a further 3 per cent on Monday. The stock has lost a quarter of its value since early March.

AMP last week admitted to charging clients fees for services they did not get and misled the corporate regulator about it 20 times. The company also admitted to manipulating a supposedly independent report into the debacle, commissioned by AMP’s board. Chairman Catherine Brenner is facing pressure to step down for her role in the doctored report, while AMP group counsel Brian Salter has been forced to take leave. Many of the largest institutional shareholders in the country are pushing for a complete board overhaul.

Law firm Quinn Emanuel Urquhart and Sullivan said it would be ready to file a shareholder class action against the embattled finance group within 10 days. Quinn Emanuel partner Damian Scattini, who has done stints at class action specialist firms Slater & Gordon and Maurice Blackburn, said he had been investigating an action against AMP since early last month, well before revelations at the banking royal commission last week smashed its share price.

“We have been looking at AMP since the share price started to free fall from March 9,” Mr Scattini said.

“The action should be ready to file within the next ten days.”

Slater and Gordon principal lawyer Mathew Chuk said his group was “closely investigating” AMP’s potential liability to its investors, which could be one of the biggest class actions in Australian history.

“The revelations heard in the Royal Commission this month have demonstrated that AMP withheld important information from corporate regulators over many years,” Mr Chuk said.

“It is likely that AMP had an obligation to disclose that misconduct to the market at large and that investors may have very significant claims against the company arising from that failure”

Shine Lawyers also said it is investigating a class action

It will be an open class, meaning all eligible investors will participate in it even if they do not sign up to a funding agreement.

Mr Scattini said AMP’s mum and dad investors “have now lost their savings due to its dishonesty”.

He said Burford Capital, which holds itself out as the world’s largest litigation funder, had agreed to back the potential claim.

“QE has been investigating AMP’s precipitous share price fall even before the most recent revelations of misconduct, and having Burford, the world’s top litigation finance company, in place as our partner means we’re ready to move quickly on behalf of shareholders,” he said.

He declined to say whether any institutional investors had already signed up to the potential lawsuit.

Mr Scattini left Slater & Gordon in 2011 after working on compensation for victims of the Storm financial disaster. He then headed Maurice Blackburn’s Queensland class action team, working on the Wivenhoe floods, before joining Quin Emanuel in late 2015.