AMP chief quits over scandals
AMP in New Zealand is distancing itself from the scandal absorbing its parent company in Australia.
AMP chief executive Craig Meller has resigned with immediate effect and the Australian financial services provider has apologised ‘‘unreservedly’’ for serious misconduct, which came to light through a judicial inquiry.
Australia’s banking royal commission found earlier this week that AMP lied to Australia’s corporate watchdog, the Australian Securities and Investments Commission (ASIC), for almost a decade to cover its widespread practice of charging customers for services they did not receive.
The commission heard it had made a deliberate decision to charge ‘‘orphan’’ clients financial advice fees for three months when they went into a central pool, often after their advisers retired.
Mike Wilkins, a non-executive director , has been appointed acting chief executive while Meller’s replacement is found, the company said in a statement.
A spokesman for AMP in New Zealand said it operated within a different regulatory and governance framework, with different operating and distribution models.
‘‘We continue to maintain an open and transparent relationship with New Zealand regulators – the FMA [Financial Markets Authority] and RBNZ [Reserve Bank of New Zealand].’’
An immediate, comprehensive review of AMP’s regulatory reporting and governance processes will be undertaken. This will be overseen by a retired judge or equivalent independent expert who will be appointed imminently.
A board committee has been established to review issues uncovered by the commission.
AMP will be making a submission to the Royal Commission to respond to the issues raised. The submission will also address the issue of the independence of the report by law firm Clayton Utz into the fee-for-no-service model.
It has been reported that senior AMP figures, including board chairwoman Catherine Brenner, requested changes to the ‘‘independent’’ report.
Brenner said: ‘‘AMP apologises unreservedly for the misconduct and failures in regulatory disclosures in our advice business. The board is determined that we will meet these challenges head on, accelerating changes in both culture and performance at AMP.
‘‘We have been driving muchneeded change and improvement in our advice business … over the past year but we know we have much more to do to.’’
Craig Meller said: ‘‘I am honoured to have been the CEO of AMP. I am personally devastated by the issues which have been raised publicly this week, particularly by the impact they have had on our customers, employees, planners and shareholders. This is not the AMP I know and these are not the actions our customers should expect from the company.
‘‘I do not condone them or the misleading statements made to ASIC. However, as they occurred during my tenure as CEO, I believe that stepping down as CEO is an appropriate measure to begin the work that needs to be done to restore public and regulatory trust in AMP.’’ –Stuff