AMP Limited is facing challenges on multiple fronts in the wake of having announced a strategy which will see the exit of significant numbers of aligned advisers and significantly reduced pay-outs from buyer of last resort (BOLR) arrangements.
The multiple fronts are actions considered by the AMP Financial Planners Association, individual litigation being mounted by planners significantly adversely affected by the BOLR changes and efforts by the Association of Independently Owned Financial Professions to have AMP advisers join their legal efforts to challenge the Government’s changes to grandfathered remuneration.
The AIOFP’s efforts were exemplified by its chairman, Melbourne-based academic, Adrian Raftery who has used social media to urge affected AMP advisers to join the AIOFP’s High Court challenge.
He pointed out that those who had borrowed had seen their LVRs go from 50 per cent to over 100 per cent.
Raftery’s urgings came at the same time as some AMP advisers told Money Management that the changes to BOLR had left them financially “under water” with businesses which had been valued at around $2 million (excluding debts) now being valued at as little as $200 000.
What is more, they claimed that the loans which had funded their acquisition of AMP client books had been provided by AMP Bank.
While outlining that the business intended to move forward with fewer but more productive advisers, AMP Limited has yet to detail the precise numbers likely to leave the business but it is believed that it could reach several hundred.
The company’s documentation released to the Australian Securities Exchange (ASX) this week pointed to the company scaling up its employed adviser channel, while reducing the number of aligned advisers.
It also pointed to 20 per cent of adviser practices accounting for around 60 per cent of revenue – a statement which was interpreted as confirming that AMP would be looking to part ways with smaller aligned practices which modest books of clients.
The AMP Financial Planning Association has not yet made public its strategy for dealing with the company’s radical changes, but is under significant member pressure to act.amp
Comments
AMP at its best. It did not support its advisers before during or after the Royal Commission and it all started when it demutualised and brought in former bank employees to run what was once a great organisation. Why aren't we talking about the high rate of suicides within the industry? AMP has a history of throwing advisers under the bus. Mr Le Ferrrari is not going to solve AMP's woes with this sort of behaviour. Come on journalists start writing about the black infesting the industry and I refer to Adel Ferguson. Amazing how she has been able to sensationalise week in week out.
I can't see other journos going after Adele Ferguson. Imagine the promo for the story, ''Tonight in the first of a 10 part series, we uncover the real Adele Ferguson and her ability to put together factual horror stories on the banking and financial services industry. How those ripped off come to her with there stories, internal whistle-blowers who provide the evidence of wrong-doing, and the company executives to humiliated and scared to talk to her..."
Devil's, if I was you, I'd stick to watching The Bachelor.
you mean that ex AMP adviser that murdered his ex wife and kids? No sympathy for him sorry.
No, I wasn't.
The AMP Financial Planning Association is led by advisers, not business people, and they have been royally stitched up by Ferrari, Wade and Co.
The AMP actions were predictable 10 months ago and at at every point during the past 10 months there have been indicators that this would happen.
There is now fragmentation within adviser ranks as a result of AMP's obvious "divide and conquer" approach so what remains is very little muscle to achieve something for the disadvantaged.
The only solution is for planners to get AMP where it hurts.. move clients away from AMP and look for external platforms. Mr De Ferrari should actually think about completing the Ethics course.. is ok to treat loyal planners in this way?
AMP sends out a letter sating that " AMP aims to seize the opportunity created by the current disruption in the wealth management market and reinvent wealth management in Australia". No mention of the fact that they contributed to this disruption. Yes AMP reinvent yourselves, maybe in Borneo. If you think advisers are going to support your products anymore you have another thing coming. We advisers do stick together, more than AMP realises, amps name is crap, there is no trust left with advisers or clients, nothing will change it. They are better off scrapping the whole company.
first AMP should throttle whoever thought the BOLA would work. Secondly, the AMP Association is complaining there Advisers will be forced on Centrelink...how ironic!
Lastly, there seems to be a few facts missing here. The loan from AMP was very discounted. The AMP Advisers could have sold anytime for as high as they could get, so why not cop the downside? Also AMP Advisers must take a large part of the responsibility for the dire industry. All care no responsibility is most Advisers motto when under a large dealer.
Just going to qualify something in the last post. AMP did not discount those loans one bit. They were st full market rates. AMP advisers couldn’t sell there books at anytime. BOLR is a mid construe term. There was only one buyer ever and it was AMP and it was a 2 year process before you sold that book and then you were forced to stay out of the industry for 3 years. There was only one seller and one buyer for books. You couldn’t sell your book to the feee market at anytime. AMP advisers worked within the constraints that we were allowed to because of the company. I have personally had them badger and threaten me to remediate clients for issues that were before I acquired the clients from AMP. Make no mistake about it, there is no free market for AMP advisers and they are trapped for issues that are not related to their ability to be a good planner
Just astounds me that people can use this forum to throw the boots into an AMP planner - you should be ashamed of yourselves.
Bearstow, i seem to remember your name on another post talking about mental health of advisers and you were quite condemning their as well. Effectively saying get help or shut up. I am very sad to see this type of comments to people who are on their knees. Lets all support each other because who knows, next week it might be you are me. What is happening around us is new to everyone and frightening for those impacted.
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I would encourage a group of AMP advisers to contact Kate Carnell and get her to take on AMP as a test xase, she is small business ombudsman
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