Australia’s financial industry was turned on its head with Friday’s announcement that AMP chief executive Craig Meller is resigning in light of an allegation that revealed that his business had been charging fees for services not rendered. As Australia’s largest wealth management company, AMP apologized “unreservedly” for its part in the scandal. Meller admitted to lying to officials for more than ten years and is the first executive to be fired as a result of the investigation.
The royal commission, Australia’s highest level of public inquiry, took place following Prime Minister Malcolm Turnbull’s orders to investigate a series of situations of financial misconduct. Turnbull’s government is now proposing stricter guidelines and harsher consequences for bankers and financial industry executives who are convicted of committing corporate misconduct. Bankers caught violating these laws can now spend up to ten years in prison.
In a meeting this week, the hearing confirmed that AMP had continually misled the country’s corporate watchdog, Australian Securities and Investments Commission (ASIC), regarding its payment acquisition. In addition to this scandal, the Commonwealth Bank also admitted that its employees had collected fees by charging deceased clients for financial input. All of these events have caused much turmoil in the country, as politicians race to fix the issue and citizens express distrust in the industry.
Mike Wilkins, a member of the AMP Limited board and former chief executive of IAG, was appointed to take over for Meller.