AIOFP ‘appalled’ by ANZ shut down of adviser revenue

In a letter to customers last week, ANZ said the trustee of its Retirement Portfolio Service superannuation fund is reminding recently transferred members, with accounts that currently pay grandfathered commission, to consider their adviser payment arrangements.

They explained that this is in response to the Hayne commission’s recommendation of the removal of grandfathered commissions.

ANZ also said it is advising members how they can instruct it to cease the payment of future commission, with a customer mailing planned for 31 May 2019.

“We understand that this communication may be a concern to some advisers, however in the current environment it is important that customers understand the fees that they are paying and options available to them,” the letter continued.

“We are reminding customers with an ongoing relationship to speak to their financial adviser to discuss ongoing service arrangements.”

AIOFP executive director Peter Johnston said it will be seeking advice from its members, and its legal advisers, for the purposes of exploring the possibility of a class action against ANZ to seek damages for its proposed course of action.

Further, he said the industry body is currently in discussion with a litigation funder to explore the commencement of such proceedings.

“The AIOFP and its members are appalled by the unilateral action on the part of the ANZ Bank in allegedly seeking to encourage its customers to break their existing contracts with their financial advisers,” Mr Johnston said.

“The ANZ proposes to write to its customers advising them to write to the bank to instruct it to cease payments of commissions to advisers. The ANZ appears to base its reasons for doing so on the ‘recommendations’ of the Hayne royal commission regarding the payment of ‘grandfathered commissions’.

“These contracts were reached by agreement between the parties, and until there is legislation enacted seeking to abolish such payments, the ‘recommendations’ of the royal commission are not law.”

Adrian Flores

Adrian Flores is a deputy editor at Momentum Media, focusing mainly on banking, wealth management and financial services. He has also written for Public Accountant, Accountants Daily and The CEO Magazine.

You can contact him on [email protected].