IOOF top brass face ban
Shares dive after APRA moves to disqualify execs
UNDER siege wealth advice giant IOOF saw its share price fall more than 35 per cent amid revelations five senior employees could face disqualification from running super funds.
The action stems from claims aired at the finance royal commission that IOOF used superannuation fund members’ own money to compensate them after an investment bungle.
The Australian Prudential and Regulation Authority yesterday began Federal Court disqualification proceedings against the five business leaders from being pension fund trustees. The regulator claims the five failed to act in the best interests of superannuation fund members. IOOF shares fell 35.8 per cent to $4.60.
This is a huge fall from the $10.72 shares were trading at the end of December last year.
The wealth advisor put out a statement saying it was “disappointed” with APRA’s action. “IOOF believes that these allegations are misconceived, and it and its executives intend to vigorously defend the proceedings,” the IOOF statement said.
Facing disqualification proceedings are chief Christopher Kelaher, chairman George Venardos, chief financial officer David Coulter, general manager of legal, risk and compliance Paul Vine, and general counsel Gary Riordan.
“If successful, the disqualification proceedings would prohibit the above individuals from being or acting as a responsible person of a trustee of a superannuation entity,” APRA said. APRA is also seeking to impose additional conditions on the firm. IOOF must respond to the show cause notice within 14 days.
Also yesterday, ANZ acknowledged the APRA move clouds the planned sale of ANZ’s super business to IOOF.
ANZ agreed to sell its OnePath Pensions and Investments business to IOOF in October last year for about a billion dollars. “Given the significance of APRA’s action, we will assess the various options available to us while we seek urgent information from both IOOF and APRA,” ANZ deputy chief Alexis George said.
APRA deputy chair Helen Rowell said her organisation had been seeking to resolve its concerns with IOOF over several years but considered it was now necessary to take stronger action.