AAA positive on AMP contract issue

A stand-off between AMP and advisers formerly associated with AXA is still going after nearly nine months, but the group representing the advisers is confident a resolution is near.

Tuesday, July 31st 2012, 7:11AM 2 Comments

Last November Good Returns reported concerns raised by the AAA Advisers Association, formerly the AXA Advisers Association, about product providers trying to contract out of their responsibilities under the Financial Advisers Act.

It raised the issue in relation to contracts produced by AMP, which was concerned it could be liable for advice given by affiliated advisers on other providers' products; the AAA disputed this, saying AFAs were liable for their own advice.

AAA president John Wood confirmed the issue was "still live" and said there would be a presentation on the topic to the AAA board meeting this Thursday.

He said he couldn't comment further until the board had been given the information.

However, he said he was confident the two parties would reach an agreement that would be "of benefit to everybody or at least give them good choices anyway".

A lot of work had gone on behind the scenes and "everyone should be pretty pleased with the outcome", he said.

Wood said there was no bad blood between AMP and the AAA and the dialogue had been "very good and very positive on both sides"; the issue had been largely one of legal interpretation of new legislation.

"If you talk to one legal expert they've got one view and if you talk to another legal expert they've got another view. Our legal people say the Financial Advisers act states AFAs have the responsibility and they are liable; AMP's legal people have a different view.

"Ultimately it will come down to test cases and precedent when it is set."

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Comments from our readers

On 31 July 2012 at 10:47 am Amused said:

Oh come on! This dispute was always about AMP affiliated advisers offering other providers products to clients and AMP not wanting those clients to have any option outside of AMP. Anybody who deals with or has dealt with AMP knows that’s how AMP runs their business. They are well known in the industry for it. We can have AMP’s legal experts argue the angle of “liability” for other provider’s products but they are not fooling anyone with this tactic. Advisers know what is really at issue here i.e. the adviser been able to choose the most appropriate product/provider for their client.

On 1 August 2012 at 9:08 am Anon said:

So AMP requires the same of its advisers as other providers and their advisers. If you are an affiliated/aligned adviser then you offer a particular companies product. Is this news?

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