Macdonald (left) and De Ferrari

Former AMP planners expressed shock and elation on Wednesday after the courts ruled in their favour in their lawsuit against the wealth manager for reneging on contractual agreements under its controversial Buyer of Last Resort policy.

In August 2019, AMP sought to change the terms of the BOLR policy due to the changing market environment post-Hayne Royal Commission, sparking a class action litigation suit by affected practices.

The Federal Court on Wednesday ruled  plaintiffs Equity Financial Planners and Wealthstone incurred losses of $813,560 and $115,533, respectively.

The situation of both firms differed slightly – Equity never entered the buyback process while Wealthstone had pursued one.

AMP went into a trading halt before market opening this morning, with a later update stating it acknowledged the court decision but is “reviewing the judgement in detail”, leaving open the possibility of an appeal.

“Subject to any appeal, a process will be required to determine the impact of the decision on other group members,” the update said.

AMP declined to add any further commentary beyond the market update and will take its time to assess the outcome of the judgement.

Boris Gulshanov, a former AMP Financial Planning authorised representative and member of the class action, urged AMP and its senior leadership not to appeal the decision.

Gulshanov tells Professional Planner he and other class members felt vindicated by the court verdict but did not erase the personal toll taken by the dispute with his former licensee and subsequent legal process.

“It’s nice that it has been acknowledged, it’s a good feeling,” Gulshanov says, whose authorisation to provide advice ceased in 2020 and no longer works in the financial sector. “But it’s not going to bring back the sleepless nights and the pressure. There are people that remortgaged their homes, ended up in hospital [or worse].”

Neil Macdonald, CEO of The Advisers Association (which historically represented AMP planners) says he is pleased with the outcome, but is still absorbing the detail.

“We’re obviously pleased with Justice Moshinsky’s findings, he accepted all of the arguments our members put forward,” Macdonald says. “The fact that it’s taken quite a long time would mean that it’s a well-considered judgement.”

The class action was led by Corrs Chambers Westgarth, who declined to comment further.

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