Class Action Settlement: AMP to Pay Out $80 Million Over Alleged Overcharges in Pension Fees
AMP Agrees to Pay A$120 Million to Settle Class Action Over Excessive Fees
Sydney-based AMP Ltd. has agreed to pay A$120 million ($80 million) to settle a class action over allegations that the company charged excessive fees on some pension accounts for over a decade.
The lawsuit, known as the Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry, took place from 2017 to 2019. The settlement was announced in a statement on Monday.
According to the statement, the agreement concerns fees charged to members of certain AMP superannuation funds. The fees in question also include interest rates received and levies on cash-only fund options.
AMP made no admission of liability in the class action. The settlement does not include any compensation for lost returns or damages.
Alexis George, the Chief Executive of AMP, stated that the settlement of the class action is an important step forward for the company. She added that the settlement allows AMP to put the legacy matter behind them.
The class action covers activity from July 2008 to May 2020. The number of members involved in the class action is not specified. AMP will contribute approximately A$75 million to the settlement, with the remaining balance being met by insurance.
The settlement remains at A$120 million ($80 million). The statement regarding the settlement was issued by AMP.
George further stated that the settlement demonstrates AMP's commitment to putting its customers first and to making things right when they go wrong. She emphasized that the company is focused on its transformation and delivering better outcomes for its customers.
The settlement comes after a series of scandals and investigations that have plagued AMP in recent years. The company has been under scrutiny for its involvement in various misconducts, including charging customers for services they did not receive, and providing inaccurate financial advice.
In response to the settlement, the Australian Securities and Investments Commission (ASIC) stated that it will continue to work with AMP to ensure that the company complies with its obligations under the law. ASIC also stated that it will continue to take enforcement action against any entity or individual that engages in misconduct.
The settlement is expected to be finalised in the coming months, subject to court approval. AMP has stated that it will provide further updates to its stakeholders as more information becomes available.
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