ASIC has commenced proceedings against AMP for charging premiums and advice fees to deceased customers
The Australian Securities and Investments Commission (ASIC) has revealed that it has commenced civil penalty proceedings in the Federal Court against five companies that are, or were, part of the AMP Limited group, alleging that these entities were involved in charging life insurance premiums and advice fees to more than 2,000 customers despite being notified of their death.
ASIC alleged that the AMP companies received over $500,000 in insurance premiums from the superannuation accounts of deceased customers, with at least $350,000 charged between May 2015 and August 2019. Additionally, it is alleged that the AMP companies received over $100,000 in advice fees from deceased customer accounts, with at least $75,000 being charged between May 2015 and August 2019. The regulator’s case focuses on the alleged breaches occurring after 26 May 2015 because any breaches occurring before that date are now statute-barred under the law.
The relevant companies (AMP Companies) are:
The company regulator added that the AMP companies’ conduct demonstrated a system of conduct or pattern of behaviour that was, in all the circumstances, unconscionable.
ASIC has stated that it commenced this proceeding because licenced financial services companies need to have robust compliance systems to ensure they meet their legal obligations to customers. Customers, and their beneficiaries, should have confidence that they will be correctly and lawfully charged for any financial services or products.
ASIC seeks declarations of contraventions of the ASIC Act and Corporations Act. ASIC is also seeking pecuniary penalties and other orders to be made by the Federal Court.
The proceeding will be listed for a case management hearing on a date yet to be set.