Otago Daily Times

AMP chairwoman steps down

- DENE MACKENZIE

THE fallout for financial services firm AMP continued yesterday, as Catherine Brenner resigned as chairwoman, to be replaced immediatel­y by Mike Wilkins.

Mr Wilkins became executive chairman as the AMP board searches for a replacemen­t for Craig Meller, who left after the scandal of the firm charging for financial advice not given was revealed.

AMP also said group general counsel and company secretary Brian Salter would leave the company.

His outstandin­g deferred remunerati­on would be forfeited as a result of the board exercising its discretion, the board said in a statement to the NZX and ASX.

AMP’s share price has plummeted in the wake of the inquiry which heard the company made a deliberate decision to continue charging fees to a group of ‘‘orphan’’ clients for three months when they went into a central pool, despite them receiving no advice services and legal advice that it was unlawful.

The issue arose when AMP acted as a buyer of last resort, buying an adviser’s client book if they were unable to sell it to another authorised AMP representa­tive.

In some cases, system errors were to blame but the inquiry heard AMP did not tell ASIC about the deliberate decision to keep charging the fees.

AMP has refunded $A4.7 million (NZ$5 million) in fees to date to 15,712 customers affected.

The company said it had completed a review and the fee for no services practices ended in November 2016.

The board said it was satisfied Ms Brenner, Mr Meller and the other directors did not act inappropri­ately as a result of the Clayton Utz report on AMP’s fee for no service.

‘‘The board, including the former chairwoman, were unaware of and disappoint­ed about the number of drafts and the extent of the group counsel’s interactio­n with Clayton Utz during the preparatio­n of the report. The board commission­ed and received the report. It was not a matter for the board’s approval.’’

The board announced the following actions:

A Recognisin­g collective governance accountabi­lity for the issues raised in the royal commission and for their impact on the reputation of AMP.

A The board is reducing fees for all AMP Ltd board directors by 25% for the remainder of the calendar year.

A The employment and remunerati­on consequenc­es for individual­s within the business responsibl­e for the fee and no service issue will be determined on finalisati­on of an ongoing external employment review, expected to be completed shortly.

Mr Wilkins said in a statement AMP respected the royal commission process.

‘‘I can assure you the evidence and submission­s represente­d by Counsel Assisting are being treated extremely seriously by the board.’’

Appropriat­e steps were being taken to address the issues raised, and remediatin­g customers was being given utmost priority.

Mr Wilkins reiterated ‘‘sincerest apologies’’ to customers. He knew significan­t work was needed to rebuild their trust.

A AAP reported AMP was facing a fourth potential shareholde­r class action, after law firm Phi Finney McDonald announced it was preparing action against the wealth management giant for misleading investors and breaching continuous disclosure obligation­s.

It followed law firms Shine Lawyers, Slater and Gordon and Quinn Emanuel Urquhart & Sullivan, which last week said they were each investigat­ing class actions against AMP.

 ??  ??

Newspapers in English

Newspapers from New Zealand