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AMP boss quits after royal commission mauling

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AMP chief executive Craig Meller has quit the wealth management giant, becoming the first major casualty of the financial services royal commission.

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Meller says he is “personally devastated” after AMP admitted to charging clients for advice they never received and then lying to the corporate watchdog about it.

The chief executive, who had been set to retire at the end of the year, insisted he had not known about the behaviour but acknowledged that he was ultimately responsible.

“I do not condone them or the misleading statements made to ASIC,” Meller said in a statement on Friday.

“However, as they occurred during my tenure as CEO, I believe that stepping down as CEO is an appropriate measure to begin the work that needs to be done to restore public and regulatory trust in AMP.”

Former IAG chief executive Mike Wilkins, who joined AMP’s board in 2016, will replace Meller on an interim basis.

Chairman Catherine Brenner said AMP was sorry and working on changing its culture.

“AMP apologises unreservedly for the misconduct and failures in regulatory disclosures,” Brenner said.

AMP shares have been in freefall since the company began giving testimony to the royal commission on Monday, wiping about $1.3 billion off its market capitalisation.

The wealth management giant faces possible criminal charges after the commission heard it deliberately and unlawfully continued charging fees to “orphan” clients for three months despite them not receiving advice services.

AMP group executive for advice Jack Regan admitted that one letter to ASIC claimed clients were at fault for being charged ongoing fees, when in some cases it was the result of a conscious effort by AMP.

AMP and the nation’s big four banks have already paid almost $219 million in compensation to more than 310,000 financial advice customers charged fees for no service.

AMP has refunded $4.7 million across more than 15,700 customers since it began cooperating with ASIC in May last year.

The company on Friday said it will make a submission to the royal commission over the issues raised.

AMP shares were worth $4.42 before the market opened on Friday, down 10 per cent this week.

– AAP

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