AMP is bracing for possible criminal charges after the banking royal commissioner suggested the wealth manager may have misled the regulator about charging fees for no service.
Kenneth Hayne QC is leaving it up to the Australian Securities and Investments Commission to decide whether to pursue a criminal prosecution.
Australia’s largest wealth manager denies committing a criminal offence in giving ASIC an independent report by Clayton Utz on the fees-for-no-service issue last year, which went through 22 draft versions with changes from the company.
Mr Hayne said AMP adopted an attitude towards the regulator that appeared to him not to be forthright and honest, in its dealings with ASIC about the extent and nature of its fees-for-no-service reporting.
‘Indeed, the statements made could be seen as a deliberate attempt to mislead,’ he said in his interim report.
Mr Hayne said there were senior people within AMP who knew about the charging of fees for no service and internal lawyers warned it was a breach of the law.
‘Despite all of this, AMP provided ASIC with information that was false or misleading,’ he wrote in his interim report.
‘Senior management and executives who contributed to the misleading of ASIC over a two-year period had knowledge of the true extent and nature of the conduct, and, in at least some cases, were warned by junior staff about it being a breach, but continued with a misleading narrative to ASIC.’
Mr Hayne said AMP’s culture and governance practices reflected insufficient concern for adherence to the law.
‘On its face it reflects a persistent and prevalent attitude of senior persons within AMP that it is acceptable to deal with ASIC other than frankly and candidly.’
Mr Hayne said AMP may have misled ASIC and made false representations to it that the Clayton Utz report was independent.
Mr Hayne said the matters were under active consideration by ASIC and made no findings about the conduct of the specific people involved.
The fees-for-no-service scandal led to the departure of AMP’s CEO and chair in April, as barristers for the royal commission suggested the company face criminal charges for lying to the regulator.
Responding to the interim report, AMP acting CEO Mike Wilkins said the company had reset the business since April.
‘AMP is focused on ensuring that adherence to the law, meeting community expectations and the best interests of our customers is fundamental to our culture and governance,’ Mr Wilkins said.
‘We are also committed to ensuring that our ongoing engagement with ASIC and other regulators is forthright and honest.’