InFocus: Advisers need less conversation, more action on BOLR

 

The problem is, many advisers need to act now. Advisers are facing very serious and ‘impactful’ issues and there are critical decisions they need to make. Big talk is not helping advisers navigate the issues – and waiting is not a good option.

 

AMP advisers are not a homogenous group. In our view, AMP advisers broadly fall into one of the following four categories:

 

The purported BOLR changes have affected advisers differently depending upon what steps they have taken so far. Advisers in each of those categories face some common problems but many also face different legal and distinct practical issues. 

 

 

‘Safety in numbers’ is, of course, a well-worn saying. However, we do not believe it applies in the case of BOLR. Advisers are facing individual issues now. These can’t be resolved by being part of a single group and waiting. Further, advisers have individual legal issues, and some categories have different (and we think stronger) legal claims against AMP. If there was a class action, which included all AMP advisers, we believe this could be problematic for quite a number of reasons.

 

In the battle to come, we don’t think individuals are ‘safer’ simply because there are a large number of them heading in one direction. In fact, grouping together and being ‘in the pack’ might prove to be counterproductive, even dangerous. 

 

We are concerned that where individual advisers have not sought and received legal advice which will afford them a strategy suited to their specific situation, there is a strong possibility of a poor outcome for them. AMP advisers need not fear persecution by anyone by separating themselves from the pack and obtaining their own advice. Having been the providers of advice for many years, I would now encourage AMP advisers to get their own advice, and not rely upon second or third-hand rumour, or ‘big’ generalised commentary from people whose motivations are unclear. 

 

In the past, how well would your clients have fared if they had sat back and followed the pack and made their decisions based on vague and unreliable public or general information, rather than obtaining your customised professional guidance.

 

We think it is more sensible that advisers approach the BOLR issue by keeping in mind which category they belong to and what their individual needs are. 

 

 

Many of the pre-8/8 advisers I have spoken to, and those who I act for, have deadlines under the BOLR process right now.  A key deadline is the exercise date.  For some advisers, their exercise date has passed without any formal exercise by AMP of its right to a six-week extension.  Moreover, some of those advisers are yet to receive valuations (or even be told when a valuation is likely to be forthcoming).  Moreover, in some instances, BOLR audits are incomplete, responses to BOLR audits have not been received and/or ‘look back audit’ processes are seemingly hanging over the heads of advisers like the Sword of Damocles.

 

Some advisers are facing the difficult decision of whether to close the doors of their business on their exercise date (or after the six-week extension) prior to having their audit and valuation issues resolved and without any clear proposed outcome being articulated by AMP. 

 

What may well be one of the worst outcomes of this debacle is some advisers have told me they don’t believe they can communicate openly to their clients about the situation given all the uncertainty. 

 

Seemingly this is unimportant as, according to a recent media article, AMP now takes the view that the average Aussie need not be paying ongoing advice fees anyway.

 

 

Despite all the talk, advisers are grappling with these issues in a vacuum. Not only is there a lack of responsiveness from AMP on a ‘case-by-case’ but also there is little useful or practical advice being made available by almost anyone.

 

In fact, we have heard of examples of what can only be termed misinformation being circulated in relation to potential class actions (which can by definition only consider the circumstances of the lead claimant) encouraging advisers not to seek independent advice to deal with immediate practical issues.  We don’t know what the motivation or agendas of the people circulating such information really is, but one thing is for certain, they are not helping advisers with the problems they face today.

 

 

Clearly, advisers facing these circumstances need to take control and act now, for their own wellbeing, including their health.

 

The key thing these advisers need to understand is that acting in response to their individual situation now, need not be at the expense of maintaining their broader rights, including potential rights to compensation or damages and/or proper performance of their contract with AMP.

 

Further, responding in a properly informed and strategic way to the practical issues you face now, doesn’t necessarily mean that you can’t be part of a larger action or a class action if that is something that you want to do.  If someone is telling you this, then ask them to explain very clearly on what basis and whose advice they are telling you this (and ask what their real motivation or agenda is).

 

Advisers need to get ‘cut-through’ with AMP now.  The only way to do this is to step away from the pack and deal with AMP one-on-one at a practical level and the only way to do that is from an informed position and individual strategy.