Nick Bruining: Two million old and current customers up for slice of AMP class action over overcharges
More than two million current and former AMP customers have joined a class action against the wealth manager, which began in the Federal Court last week.
Led by class action specialists Slater and Gordon and Maurice Blackburn Lawyers, the case alleges the trustees of several AMP super funds 'systematically' overcharged members of some popular products between 2008 and 2020.
Around 2.5 million AMP customers have received invitations to join the class action over the past few weeks. Many have been contacting their financial advisers to ask whether they should participate.
'In some cases, the customers are concerned that the action will impact the financial advisers who may have sold them the product in the first place,' said one former AMP adviser, who asked not to be named.
'We can explain that the action is against the company and not AMP's former agents'
The products include AMP's Flexible Lifetime Super and My Super products. In many cases, legacy superannuation products sold from the 1990s on were consolidated into these products over the years.
The claim also includes an allegation AMP was overcharging investment fees on cash and term deposits when no other retail super fund was doing the same.
Slater and Gordon head of class actions Emma Pelken-Caven said thousands of Australians trusted AMP with their retirement savings and instead lost thousands of dollars.
'We believe the evidence in this case will show that AMP was driven by profit and not the best interests of its superannuation members — made up of millions of hardworking Australians,' Ms Pelken-Caven said.
An AMP spokesman told Your Money the firm was defending the class action.
'Our focus is on delivering quality investment returns, low fees and high standards of service and support to our super members,' he said.
A class action is used by a group of people to sue someone or a company for injury, negligence or loss.
In the main, class actions are launched by the larger legal firms, which typically take a sizeable clip from the proceeds if the action is successful.
In a class action, a test case of an individual can become representative of people in a similar or identical situation, collectively known as members of the class action. The test case becomes the basis for the decision that affects all members of the action.
There are variations where you might, for example, only benefit from a favourable decision if you've signed up to the class action.
Alternatively, you might be able to use the decision of the class action in court as a basis to pursue your own legal action. You might do better in terms of the amount you receive going down this route, particularly if the class action's legal fees are steep and your circumstances warrant a greater amount.
In many class action cases, there's no court decision because the defendant might elect to negotiate an out-of-court settlement. This is often a commercial decision that weighs up the likely costs of defending the action and the chance of success if it ends up in court.
In this situation, only those who signed up to the class action would probably benefit.
The case against AMP has been set down in the Federal Court to run for seven weeks.
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Sky News AU
42 minutes ago
- Sky News AU
‘Every worker': Number of Aussies hit by unrealised gains tax in next 30 years revealed
Wilson Asset Management Founder Geoff Wilson reveals the number of Australians in the next 30 years who will be hit by the unrealised gains tax. 'Now, effectively without the indexation, we have done some numbers, and within the next 30 years, 8.1 million or more than half of the working population will be over that $3 million mark,' Mr Wilson told Sky News host Peta Credlin. 'Without indexation, eventually every worker will be paying tax on unrealised gains, so they will be paying tax on a profit that may never eventuate.'
Sky News AU
2 hours ago
- Sky News AU
NT cattlemen dealt blow in compensation push over Gillard government live export ban after judge shoots down $600 million claim
Northern Territory cattlemen have been dealt a blow in their bid for compensation over the Gillard government's decision to ban live cattle exports in 2011. The federal court has ruled the government is only liable for the loss of income suffered in one year, not three years as sought by the cattlemen. Former Labor agriculture minister Joe Ludwig announced the ban on June 7, 2011. It was lifted on July 6 the same year, but cattlemen argued the impact of the decision lasted far longer as the relationship between Australia and Indonesia soured. The ban followed an investigation by Animals Australia and Four Corners into the treatment of cattle in Indonesian abattoirs, that prompted large protest rallies in Melbourne and Sydney. The cattlemen launched a class action over the decision arguing it had cost them up to $600 million across the supply chain. In 2020, Federal Court justice Steven Rares ruled in favour of the lead applicant, the Brett Cattle Company. Justice Rares found Senator Ludwig had acted recklessly when he implemented the ban, as he awarded the company $2.94 million in damages. For the past five years, the cattlemen and the federal government have been locked in legal argument about how much compensation should be paid to the other members of the class action. The government made an offer of $215 million to settle the case, saying the ban had only affected the export of about 88,000 head of cattle in 2011. The cattlemen rejected the offer, arguing the ban impacted the number of cattle Indonesia would except from 2011 until 2013 as they sought up to $600 million in compensation. But late on Thursday, Justice Thomas Thawley ruled the quota of cattle accepted by Indonesia had only been impacted in 2011. He said a drop in the quota in 2012 and 2013 was due to the Indonesian government's policy to pursue greater self-sufficiency in its beef market, not because of the fallout from the Australian government's 2011 ban. His decision means the amount of compensation awarded is likely to be closer to the government's $215 million offer, than the $600 million the cattlemen had sought. Justice Thawley placed a 48-hour embargo on the publication of the full reasons for his decision. In a statement NT Cattlemen's Association chief executive officer Romy Carey acknowledged the court's decision. 'While the judgment marks a significant milestone in a legal battle that has spanned more than a decade, we are still working through the detail and assessing its full implications both for the families directly affected and the wider cattle industry,' she said. 'At the request of the Commonwealth, the Federal Court has placed the reasons for judgment under a 48-hour embargo. 'Accordingly, we have not yet been provided with access to the full decision and will refrain from further comment until we are in a position to respond responsibly and with the complete facts before us.'
The Advertiser
2 hours ago
- The Advertiser
'High risk': The Star's $167m credit to money launderer
The Star was willing to offer millions in gambling credit to a known money launderer and wrote falsified letters to enable overseas bank transfers from unknown individuals. These details and many more have been exposed as financial watchdog AUSTRAC pursues the embattled casino giant in the Federal Court. The Star made "innumerable contraventions" of Australian anti-money laundering laws through its conduct, including a willingness to do business with 117 high-risk customers, barrister Daniel Tynan told a Federal Court hearing on Thursday. The casino has admitted that 70 of these customers - who were junket funders, operators or players - each posed a high money laundering risk. "They would have the opportunity to gamble that money, get the returns, wash it, do it again," Mr Tynan told Justice Cameron Moore. One of these customers, Suncity junket operator Alvin Chau, was provided with credit of up to $266.67 million. Chau funded at least 3690 junket programs at The Star's Sydney casino, bringing in a turnover of about $12.6 billion. Despite media reports linking him to overseas crime syndicates, The Star continued to engage with the Suncity head, Mr Tynan said. It was only after Chau was arrested by Macau police and hit with a number of charges - including money laundering - that the casino stopped dealing with him, the court has heard. Another customer was given almost $167 million in credit despite The Star knowing from at least 2014 that he had been involved in alleged money laundering, Mr Tynan said. The casino also facilitated high-risk transactions from 1221 customers who transferred money in and out through channels that obscured their identity, the court was told. Staff at EEIS, a Macau-based subsidiary of The Star, wrote up falsified letters for local customers wanting to send funds through the Bank of China directly to the casino, Mr Tynan continued. These letters contained false claims about the source of the funds being deposited, the barrister said. Almost $990 million in deposits were made through The Star's hotel debit cards, allowing gamblers to transfer money directly to the casino without going through an Australian bank. The cards also allowed gamblers in countries like China with restrictions on gambling to disguise their transactions by claiming they were for other purposes like hotel accommodation, Justice Moore was told. The Star advanced money to customers who complained about the 24 to 48-hour waiting period before funds hit their accounts. Individuals could also withdraw cash directly, Mr Tynan said. "This is coming in anonymously, taken out in cash - it can be used for anything." AUSTRAC is seeking $400 million in penalties over the breaches while the casino has argued it can only pay $100 million without being pushed into administration. In April, the failing casino business received a $300 million rescue package from US gaming giant Bally's Corporation. The hearing continues on Friday. The Star was willing to offer millions in gambling credit to a known money launderer and wrote falsified letters to enable overseas bank transfers from unknown individuals. These details and many more have been exposed as financial watchdog AUSTRAC pursues the embattled casino giant in the Federal Court. The Star made "innumerable contraventions" of Australian anti-money laundering laws through its conduct, including a willingness to do business with 117 high-risk customers, barrister Daniel Tynan told a Federal Court hearing on Thursday. The casino has admitted that 70 of these customers - who were junket funders, operators or players - each posed a high money laundering risk. "They would have the opportunity to gamble that money, get the returns, wash it, do it again," Mr Tynan told Justice Cameron Moore. One of these customers, Suncity junket operator Alvin Chau, was provided with credit of up to $266.67 million. Chau funded at least 3690 junket programs at The Star's Sydney casino, bringing in a turnover of about $12.6 billion. Despite media reports linking him to overseas crime syndicates, The Star continued to engage with the Suncity head, Mr Tynan said. It was only after Chau was arrested by Macau police and hit with a number of charges - including money laundering - that the casino stopped dealing with him, the court has heard. Another customer was given almost $167 million in credit despite The Star knowing from at least 2014 that he had been involved in alleged money laundering, Mr Tynan said. The casino also facilitated high-risk transactions from 1221 customers who transferred money in and out through channels that obscured their identity, the court was told. Staff at EEIS, a Macau-based subsidiary of The Star, wrote up falsified letters for local customers wanting to send funds through the Bank of China directly to the casino, Mr Tynan continued. These letters contained false claims about the source of the funds being deposited, the barrister said. Almost $990 million in deposits were made through The Star's hotel debit cards, allowing gamblers to transfer money directly to the casino without going through an Australian bank. The cards also allowed gamblers in countries like China with restrictions on gambling to disguise their transactions by claiming they were for other purposes like hotel accommodation, Justice Moore was told. The Star advanced money to customers who complained about the 24 to 48-hour waiting period before funds hit their accounts. Individuals could also withdraw cash directly, Mr Tynan said. "This is coming in anonymously, taken out in cash - it can be used for anything." AUSTRAC is seeking $400 million in penalties over the breaches while the casino has argued it can only pay $100 million without being pushed into administration. In April, the failing casino business received a $300 million rescue package from US gaming giant Bally's Corporation. The hearing continues on Friday. The Star was willing to offer millions in gambling credit to a known money launderer and wrote falsified letters to enable overseas bank transfers from unknown individuals. These details and many more have been exposed as financial watchdog AUSTRAC pursues the embattled casino giant in the Federal Court. The Star made "innumerable contraventions" of Australian anti-money laundering laws through its conduct, including a willingness to do business with 117 high-risk customers, barrister Daniel Tynan told a Federal Court hearing on Thursday. The casino has admitted that 70 of these customers - who were junket funders, operators or players - each posed a high money laundering risk. "They would have the opportunity to gamble that money, get the returns, wash it, do it again," Mr Tynan told Justice Cameron Moore. One of these customers, Suncity junket operator Alvin Chau, was provided with credit of up to $266.67 million. Chau funded at least 3690 junket programs at The Star's Sydney casino, bringing in a turnover of about $12.6 billion. Despite media reports linking him to overseas crime syndicates, The Star continued to engage with the Suncity head, Mr Tynan said. It was only after Chau was arrested by Macau police and hit with a number of charges - including money laundering - that the casino stopped dealing with him, the court has heard. Another customer was given almost $167 million in credit despite The Star knowing from at least 2014 that he had been involved in alleged money laundering, Mr Tynan said. The casino also facilitated high-risk transactions from 1221 customers who transferred money in and out through channels that obscured their identity, the court was told. Staff at EEIS, a Macau-based subsidiary of The Star, wrote up falsified letters for local customers wanting to send funds through the Bank of China directly to the casino, Mr Tynan continued. These letters contained false claims about the source of the funds being deposited, the barrister said. Almost $990 million in deposits were made through The Star's hotel debit cards, allowing gamblers to transfer money directly to the casino without going through an Australian bank. The cards also allowed gamblers in countries like China with restrictions on gambling to disguise their transactions by claiming they were for other purposes like hotel accommodation, Justice Moore was told. The Star advanced money to customers who complained about the 24 to 48-hour waiting period before funds hit their accounts. Individuals could also withdraw cash directly, Mr Tynan said. "This is coming in anonymously, taken out in cash - it can be used for anything." AUSTRAC is seeking $400 million in penalties over the breaches while the casino has argued it can only pay $100 million without being pushed into administration. In April, the failing casino business received a $300 million rescue package from US gaming giant Bally's Corporation. The hearing continues on Friday. The Star was willing to offer millions in gambling credit to a known money launderer and wrote falsified letters to enable overseas bank transfers from unknown individuals. These details and many more have been exposed as financial watchdog AUSTRAC pursues the embattled casino giant in the Federal Court. The Star made "innumerable contraventions" of Australian anti-money laundering laws through its conduct, including a willingness to do business with 117 high-risk customers, barrister Daniel Tynan told a Federal Court hearing on Thursday. The casino has admitted that 70 of these customers - who were junket funders, operators or players - each posed a high money laundering risk. "They would have the opportunity to gamble that money, get the returns, wash it, do it again," Mr Tynan told Justice Cameron Moore. One of these customers, Suncity junket operator Alvin Chau, was provided with credit of up to $266.67 million. Chau funded at least 3690 junket programs at The Star's Sydney casino, bringing in a turnover of about $12.6 billion. Despite media reports linking him to overseas crime syndicates, The Star continued to engage with the Suncity head, Mr Tynan said. It was only after Chau was arrested by Macau police and hit with a number of charges - including money laundering - that the casino stopped dealing with him, the court has heard. Another customer was given almost $167 million in credit despite The Star knowing from at least 2014 that he had been involved in alleged money laundering, Mr Tynan said. The casino also facilitated high-risk transactions from 1221 customers who transferred money in and out through channels that obscured their identity, the court was told. Staff at EEIS, a Macau-based subsidiary of The Star, wrote up falsified letters for local customers wanting to send funds through the Bank of China directly to the casino, Mr Tynan continued. These letters contained false claims about the source of the funds being deposited, the barrister said. Almost $990 million in deposits were made through The Star's hotel debit cards, allowing gamblers to transfer money directly to the casino without going through an Australian bank. The cards also allowed gamblers in countries like China with restrictions on gambling to disguise their transactions by claiming they were for other purposes like hotel accommodation, Justice Moore was told. The Star advanced money to customers who complained about the 24 to 48-hour waiting period before funds hit their accounts. Individuals could also withdraw cash directly, Mr Tynan said. "This is coming in anonymously, taken out in cash - it can be used for anything." AUSTRAC is seeking $400 million in penalties over the breaches while the casino has argued it can only pay $100 million without being pushed into administration. In April, the failing casino business received a $300 million rescue package from US gaming giant Bally's Corporation. The hearing continues on Friday.
