Risk Company Updates

Count Financial class action filed

Class action proceedings have been filed against Count Financial by Piper Alderman, relating to commissions paid to the financial advice group and its advisers over a six-year period. The class action is one of the actions taken after Royal Commission revelations. The filings allege that Count Financial contravened its obligations to its clients, failed to ensure adviser remuneration was conflict-free, act in the best interests of customers, and to provide services when fees were charged.

Count Financial was a subsidiary of Commonwealth Bank of Australia (CBA) until October 2019 when it was acquired by CountPlus. CBA provided CountPlus $300 million for conduct via an indemnity. This suit is unlikely to be the last, as Piper Alderman is requesting clients come forward from many financial planning groups.

Park Lane Advice launched for divorcées

Four former ANZ staff have set up a new advisory company, Park Lane Advice Group. The group is licensed to IOOF-owned Millennium3 Financial Services, founded by Evguenia Rutkowski, Jonathan Scukovic, Jason Bell and Peter Fedderson. The firm currently has around 89 new clients, offering broad financial advice, but aiming for clients who have been through a divorce or separation.

AMP reviewing business units

The AMP board is undertaking a portfolio review of assets and businesses, directed by new chair Debra Hazelton. Increased interest in the business has led to the review to assess opportunities.

CBA class action for expensive insurance products

A class action has been filed against CBA over allegations of the sale of overly expensive insurance products via advisory channels. The two advice subsidiaries are Commonwealth Financial Planning Limited and Financial Wisdom Limited, and the Colonial Mutual Life Assurance Society Limited, with the class action run by Shine Lawyers.

Shine alleges the financial advisers involved did not act in their clients’ best interests by neglecting to tell them that they could get substantially similar or better insurance policies from other insurance companies for lower premiums.

Two Sydney advice companies merge

Halcyon Wealth Advisers and Principle Advisers have merged, with both businesses licensed by Madison Financial Group for several years. After months of discussions, the merger is finally going ahead.

IOOF acquires MLC Wealth

IOOF has launched a $1 billion capital raising for the purchase of MLC Wealth for $1.4 billion. NAB announced it was exiting the business in 2018. IOOF will acquire 100 per cent of MLC Wealth, including its financial advice business, platforms, and asset management business. IOOF is not assuming conduct or remediation liability.