Will This $20 million Settlement Help AMP Rebuild Investor Trust?
Source: Kapitales Research
Highlights:
AMP Limited (ASX: AMP) rose 0.9% at the time of writing after announcing an in-principle settlement of a long-running class action.
The company agreed to pay around A$20 million to resolve claims linked to historical advice and insurance commission practices.
The settlement aims to close legacy legal issues as AMP continues efforts to rebuild trust and strengthen its core business.
AMP Strikes Deal on Historic Class Action — What Investors Are Saying
Sydney, Australia — At the time of writing, AMP Limited (ASX: AMP) saw its shares advance about 0.9 per cent after the financial services group reached an agreement in principle to settle a class action for approximately A$20 million. The claim relates to historical financial advice and insurance commission practices, a legacy issue stemming from past client fee and advice concerns that have weighed on investor sentiment.
While AMP has not admitted liability, the proposed settlement — which is subject to final documentation and Federal Court approval — aims to bring closure to long-running legal action concerning conduct between July 2014 and February 2021.
What the Settlement Covers
The class action alleged that certain financial advisers tied to AMP recommended products and insurance policies that generated commissions, and that some clients may have paid higher premiums or fees as a result of those recommendations. The settlement deal is intended to resolve group members’ claims without the uncertainty of protracted litigation.
Legal experts note that settling at this stage allows AMP to limit future legal costs and reputational damage, even though the final amount could vary based on court approval and costs. The move also reinforces the company’s ongoing efforts to move past historic industry criticisms and focus on future growth.
Market Reaction and Broader Implications
The modest uptick in AMP’s share price after the announcement reflects investor relief that a contentious legal issue may soon be resolved. Analysts say that clearing legacy litigation could help stabilise market confidence, especially as AMP continues to reposition its core advisory and financial services offerings.
This settlement follows other recent class action resolutions in the financial sector and highlights the regulatory and legal scrutiny of past advice practices. As AMP works through court processes for final approval, shareholders and customers will be watching closely to see if this deal truly marks the end of costly legacy matters.
Disclaimer for Kapitales Research
The materials provided by Kapitales Research, including articles, news, data, reports, opinions, images, charts, and videos ("Content"), are intended for personal, non-commercial use only. The primary goal of this Content is to educate and inform readers. This Content is not meant to offer financial advice, nor does it include any recommendation or opinion that should be relied upon for making financial decisions. Certain Content on this platform may be sponsored or unsponsored, but it does not serve as a solicitation or endorsement to buy, sell, or hold any securities, nor does it encourage any specific investment activities. Kapitales Research is not authorized to provide investment advice, and we strongly advise users to seek guidance from a qualified financial professional, such as a financial advisor or stockbroker, before making any investment choices. Kapitales Research disclaims all liability for any direct, indirect, incidental, or consequential damages arising from the use of the Content, which is provided without any warranties. The opinions expressed by contributors or guests are their own and do not necessarily reflect the views of Kapitales Research. Media such as images or music used on this platform are either owned by Kapitales Research, sourced through paid subscriptions, or believed to be in the public domain. We have made reasonable efforts to credit sources where appropriate. Kapitales Research does not claim ownership of any third-party media unless explicitly stated otherwise.
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Will This $20 million Settlement Help AMP Rebuild Investor Trust?
Highlights:
AMP Strikes Deal on Historic Class Action — What Investors Are Saying
Sydney, Australia — At the time of writing, AMP Limited (ASX: AMP) saw its shares advance about 0.9 per cent after the financial services group reached an agreement in principle to settle a class action for approximately A$20 million. The claim relates to historical financial advice and insurance commission practices, a legacy issue stemming from past client fee and advice concerns that have weighed on investor sentiment.
While AMP has not admitted liability, the proposed settlement — which is subject to final documentation and Federal Court approval — aims to bring closure to long-running legal action concerning conduct between July 2014 and February 2021.
What the Settlement Covers
The class action alleged that certain financial advisers tied to AMP recommended products and insurance policies that generated commissions, and that some clients may have paid higher premiums or fees as a result of those recommendations. The settlement deal is intended to resolve group members’ claims without the uncertainty of protracted litigation.
Legal experts note that settling at this stage allows AMP to limit future legal costs and reputational damage, even though the final amount could vary based on court approval and costs. The move also reinforces the company’s ongoing efforts to move past historic industry criticisms and focus on future growth.
Market Reaction and Broader Implications
The modest uptick in AMP’s share price after the announcement reflects investor relief that a contentious legal issue may soon be resolved. Analysts say that clearing legacy litigation could help stabilise market confidence, especially as AMP continues to reposition its core advisory and financial services offerings.
This settlement follows other recent class action resolutions in the financial sector and highlights the regulatory and legal scrutiny of past advice practices. As AMP works through court processes for final approval, shareholders and customers will be watching closely to see if this deal truly marks the end of costly legacy matters.
Disclaimer for Kapitales Research
The materials provided by Kapitales Research, including articles, news, data, reports, opinions, images, charts, and videos ("Content"), are intended for personal, non-commercial use only. The primary goal of this Content is to educate and inform readers. This Content is not meant to offer financial advice, nor does it include any recommendation or opinion that should be relied upon for making financial decisions. Certain Content on this platform may be sponsored or unsponsored, but it does not serve as a solicitation or endorsement to buy, sell, or hold any securities, nor does it encourage any specific investment activities. Kapitales Research is not authorized to provide investment advice, and we strongly advise users to seek guidance from a qualified financial professional, such as a financial advisor or stockbroker, before making any investment choices. Kapitales Research disclaims all liability for any direct, indirect, incidental, or consequential damages arising from the use of the Content, which is provided without any warranties. The opinions expressed by contributors or guests are their own and do not necessarily reflect the views of Kapitales Research. Media such as images or music used on this platform are either owned by Kapitales Research, sourced through paid subscriptions, or believed to be in the public domain. We have made reasonable efforts to credit sources where appropriate. Kapitales Research does not claim ownership of any third-party media unless explicitly stated otherwise.
Customer Notice:
Nextgen Global Services Pty Ltd trading as Kapitales Research (ABN 89 652 632 561) is a Corporate Authorised Representative (CAR No. 1293674) of Enva Australia Pty Ltd (AFSL 424494). The information contained in this website is general information only. Any advice is general advice only. No consideration has been given or will be given to the individual investment objectives, financial situation or needs of any particular person. The decision to invest or trade and the method selected is a personal decision and involves an inherent level of risk, and you must undertake your own investigations and obtain your own advice regarding the suitability of this product for your circumstances. Please be aware that all trading activity is subject to both profit & loss and may not be suitable for you. The past performance of this product is not and should not be taken as an indication of future performance.
Kapitales Research, Level 13, Suite 1A, 465 Victoria Ave, Chatswood, NSW 2067, Australia | 1800 005 780 | info@kapitales.com.au