Aussie Wealth Giant AMP Says That Proposed Tougher Regulation Would Only ‘Distract’
A struggling financial advisor in Australia, AMP Ltd., expressed their fears over the proposed regulations for the financial sector, saying that it would only distract participants from operating in an ethical manner, taking a defiant tone in their statement, released November 8, following months of damning allegations against the company.
AMP, the largest financial advisor in Australia, also rejected the suggestions that said that the biggest Aussie financial firms had failed to do what they could in order to stop charging customers fees without providing the expected service.
The comments were delivered via an aggressive reply to an interim report, part of a government inquiry, which looked at the Aussie financial industry and its conduct, which has made headlines due to its revelations of widespread wrongdoing in the financial industry. Following the publication, most major banks in the country have thrown their support towards any new regulation.
AMP, however, sent a written response to the Royal Commission’s interim report saying that there is a good chance that adding more regulation would only distract from the simple ideas that act as the guidelines for the conduct of every financial advisor in Australia and the financial industry. The AMP believe that the more complicated the law, the easier it would be to lost track of.
Many are expecting that the independent Royal Commission inquiry will lead to sweeping reforms in the Aussie financial industry when it wraps up in February of 2019. The inquiry has looked at evidence of poor governance and misconduct within the financial industry, which include taking fees from the accounts of deceased individuals, forging signatures in order to sell loans, and forcing farmers into insolvency in order to avoid drought exposure, among other things.
The Royal Commission will be resuming their hearings on the matter later in November.
AMP admitted to charging customers fees without providing the service paid for, and tampering with independent reports. The firm’s CEO, Chairwoman, and several Directors resigned following the revelations. Company shares also took a hit, down by 50% since the start of the financial year, which led to a loss of AU$7.5bn from its market value.
The company is also facing five class-action lawsuits on behalf of their shareholders, a first in Australia’s history.