Missing evidence proves AMP product push

In her opening address to the Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry on Monday, counsel assisting Rowena Orr castigated AMP for providing a key piece of evidence at 9.30pm on the night before the second hearings were due to commence.

In the final minutes of yesterday’s proceedings, her colleague counsel assisting Michael Hodge QC clarified that an email copy of the required spreadsheet was actually sent after 5pm on Wednesday 11 April and a further copy after 9.30pm on Sunday night.

But notwithstanding the to and fro over the evidence deadline, Mr Hodge said now that his team has had an opportunity to assess the document, it contains significant information about “the proportion of in-house products on the approved product lists of AMP’s licensees”.

“It contains information about four of AMPs licensees: AMP Financial Planning, Charter, Hillross and ipac,” Mr Hodge said.

“We won't summarise the position for all four licensees, however, in relation to the largest licensee, AMP Financial Planning, it shows that in each year since 2013, between 35 and 40 per cent of the investment options on the approved product list were in-house products, more than 90 per cent of the new customers invested funds in or paid insurance premiums in respect of one or more of AMPs in-house products, and the proportion of funds invested in or insurance premiums paid in respect of AMPs in-house products as opposed to external products by new customers was more than 70 per cent,” Mr Hodge revealed in an indication of further cross-examination to come on the topic of approved product lists.

The findings follow an ASIC report that lifted the lid on in-house product recommendation across the major financial institutions which Ms Orr also referenced in her opening address.

In his final address he also clarified that a statement from AMP director of advice and research Bradley Green has identified 13 incidents of AMP authorised representatives accepted “prohibited conflicted remuneration” in the post-FOFA period.

Two of five examples of these 13 incidents were not disclosed to the royal commission, Mr Hodge said.

The revelation followed an intense full-day cross-examination of AMP executive Jack Regan, in which he admitted he had a “level of discomfort” with the amount of AMP involvement in a so-called independent report conducted by commercial law firm Clayton Utz.

The royal commission financial advice hearings continue on Wednesday. Follow live at https://www.ifa.com.au/strategy/25404-royal-commission-financial-advice-hearings-live-blog