AMP is facing a fresh class action, as Shine Lawyers confirms it is investigating whether the firm's financial advisers breached their fiduciary and statutory duties to an estimated 100,000 clients.
Shine Lawyers alleges the beleaguered firm failed to act in its clients' best interests by selling in-house life insurance products at inflated prices, thus failing to provide them with objective financial advice.
The class action firm said it would imminently file the charges against AMP Life Limited, AMP Financial Planning and two of its financial planning subsidiaries Charter Financial Planning and Hillross Financial Services.
The class action, which will claim AMP and subsidiary advisers received commissions and other incentives for recommending their clients purchase insurance through AMP Life, has been funded by Woodsford Litigation Funding.
Woodsford has also bankrolled the class action against Colonial First State over "excessive" insurance premiums on super products, announced late last month.
Shine Lawyers head of litigation and loss recovery, Jan Saddler, said AMP advisers sold the life insurance products despite knowing their clients could get better deals through other insurers.
"AMP has encouraged and incentivised its financial advisers to prioritise personal gain above their professional obligations," she said.
"The clients, who should have been AMP's primary concern, have been financially disadvantaged as a result."
Saddler said these clients deserve to be compensated.
"It's unacceptable that hundreds of thousands of Australians who thought they were getting objective financial advice have instead been ripped off," she said.
"AMP Financial Planning and its authorised representatives have breached the trust of clients who relied on their advice to make decisions about their personal insurances."
The class action is open to anyone who obtained an AMP Flexible Lifetime Policy (including death, TPD, trauma, income protection and business protection insurance) from 2013 onwards from AMP Financial Planning, Charter Financial Planning or Hillross Financial Services.
The action will be filed in the Federal Court of Australia.