Financial Services firm AMP commits to providing $80 million in settlement following a class action lawsuit concerning pension fees.
AMP Settles Class Action Over Excessive Fees for A$120 Million
Sydney-based financial services company AMP has agreed to pay A$120 million ($80 million) to settle a class action regarding excessive fees charged on certain classroom accounts. The announcement was made by AMP Chief Executive Alexis George, who stated that the settlement is an important step forward for the company.
The class action covers activity from July 2008 to May 2020 and alleges that AMP charged excessive fees on members of certain AMP superannuation funds, including classroom options. The fees were not limited to the management fees but also included interest rates received and levies on cash-only classroom options.
AMP will contribute approximately A$75 million towards the settlement, with the remaining A$45 million being provided by the insurer. The settlement amount is equivalent to $80 million in US dollars.
According to Alexis George, the settlement allows AMP to put the legacy matter behind them. The company made no admission of liability in the class action, but George emphasised that AMP is committed to doing the right thing by its customers.
The legal dispute was a significant issue for AMP, and the settlement marks a resolution to the long-standing controversy. The settlement amount is the largest ever paid by an Australian financial services company to settle a class action, highlighting the severity of the issue.
The settlement is an important milestone for AMP, and it is hoped that it will help to restore trust in the company among its customers. The settlement is expected to be finalised in the coming months, subject to court approval.
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