Law firm Slater & Gordon plans to lodge class actions against major retail superannuation funds in Federal Court within weeks, the litigator has confirmed.
“We estimate a third of adult Australians could be eligible to join these actions,” the group’s spokesperson said in a statement following a press conference in Melbourne on Tuesday.
The law firm singled out Commonwealth Bank-owned superannuation fund Colonial First State and AMP Super as probable first targets in what it described as a series of legal actions it had planned.
The announcement of Slater & Gordon’s intent to lodge a class action follows the scathing fifth round of the Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry, in which retail funds bore the brunt of the investigation.
The law firm’s latest planned move would be added to several existing class actions against wealth management giant AMP.
Slater & Gordon already has a class action against AMP on behalf of shareholders in relation to allegations that continuous disclosure laws were contravened, the Melbourne-based law firm confirmed.
At its annual general meeting in May, AMP confirmed it had been served with two class-action proceedings in addition to those outline above: a claim filed in the Supreme Court of New South Wales by Quinn Emanuel Urquhart & Sullivan; and a claim filed in the Federal Court of Australia (Victorian Registry) by Phi Finney McDonald.
All of the class actions listed above were on behalf of shareholders who were affected by a drop in the company’s share price following fee-for-no-service revelations in April during Hayne royal commission hearings.
In the four months between mid-April and the start of August, when the two class actions were announced – bookended by the resignation of AMP’s then-chairman Catherine Brenner and an announcement of a $290 million-plus contingency plan to cover reparations of bad advice – AMP’s share price plummeted close to 31.3 per cent, from $4.80 to $3.30. AMP shares were trading at $3.28 at the close of trading on Tuesday.
In addition to these three class actions, law firms Shine Lawyers and Maurice Blackburn also have filed outstanding class actions against AMP – bringing the total to five.
“While we have not been served with any proceedings at this stage, we understand the proposed Slater & Gordon class action may be related to issues in our superannuation business that we previously identified and reported to the regulator,” an AMP spokesperson said in a statement on Tuesday. “As we set out in our submissions to the Royal Commission, we are already fixing these issues and remediating customers.
“We have reduced the administration fees on some of our cash investment options to address the issue of negative returns in the small number of funds impacted by this issue. We are also compensating affected customers for lost earnings.”
Slater & Gordon has named its latest class-action movement the “Get Your Super Back” campaign.
“We don’t believe there is any justification for a bank-owned fund member being worse off than industry fund members, especially when they have chosen to invest in a passive cash investment option, which requires the fund to do basically nothing,” Ben Hardwick, Slater & Gordon head of class actions, told journalists on Tuesday. “We think retail fund members should be compensated for the difference between their returns on cash, and the returns they should have received if the trustee had done its job properly. Industry funds have demonstrated the return that should be produced on cash investments when a proper effort is made by the trustee to secure the best available interest rate.”