The breakdown of the settlement reveals Insignia Financial, the current owner of OnePath, contributing $22 million, while former parent company ANZ will part with $14 million. Importantly, this proposed settlement is still awaiting judicial confirmation. As disclosed to the ASX, these developments will be reported in Insignia's first half of 2025 financial results but will not impact their underlying net profit after tax.
Despite the substantial financial remuneration, there remains a notable absence of official admission of culpability from all the implicated parties. This settlement is part of a broader initiative spearheaded by Slater and Gordon’s "get your super back" campaign, conceived to rectify malpractices unveiled by the royal commission. The initiative has previously secured multiple settlements advocating for victimised superannuation fund members.
This latest legal action targeted the OnePath Master Fund and Retirement Portfolio Service, alleging the imposition of exorbitant fees that benefitted financial advisors through unnecessary commissions while offering no additional value to members. In the words of Slater and Gordon practice leader Kirsten Morrison, the resolution serves as a testament to the efficacy of class action proceedings in addressing sweeping financial injustices.
Morrison believes this settlement renews momentum for the campaign and bolsters the firm's mission to defend Australian superannuation members' interests. These efforts coincide with Insignia's historical acquisition maneuvers, including its 2020 takeover of OnePath and associated dealer groups from ANZ, previously announced in 2017 under its former IOOF branding.
This class action further pinpointed OnePath's negligence in upholding fiduciary duties by channeling member investments into suboptimal in-house ANZ cash options, leading to unsatisfactory returns. These allegations exhibit the tangled, and oftentimes conflicting, interests at play within financial establishments that fail to prioritize client value.
Members associated with OnePath or ANZ seeking recompense from the settlement need to register with Slater and Gordon to receive their entitled payments. Notably, this isn't Insignia CEO Scott Hartley’s first encounter with remediation provisions tied to OnePath; a $23 million allocation was necessitated due to a previous enforceable undertaking from APRA, showcased in FY24 outcomes.
Before this, OnePath faced penalties in court, courtesy of ASIC, leading to a $5 million fine for deceptive practices. This revelation came on the heels of ASIC’s findings covering 2015 to 2021, denoting artificial impositions on upwards of 15,962 superannuants through misleading narratives and service failures. These cases underscore the ever-growing need for ethical reform in financial governance and transparency.
Moreover, Slater and Gordon have previously procured settlements exceeding $100 million against Colonial First State under similar misconduct accusations, fortifying the ongoing pursuit of reparative justice post-Hayne royal commission disclosures.
