AMP has responded to legal proceedings launched against it by the corporate regulator over the alleged deductions of life premiums and advice fees from the accounts of more than 2000 deceased customers.

Group Counsel David Cullen says the business “has taken this matter very seriously and we will now carefully consider the allegations raised” by the Australian Securities and Investments Commission (ASIC).

“We have been assisting ASIC with its investigation and will continue to engage constructively as part of the legal process,” he said in a statement.

ASIC announced last week it has commenced civil penalty proceedings in the Federal Court against a group of AMP-linked companies, accusing them of “unconscionable” conduct between May 2015 and August 2019.

The alleged misconduct was first aired in the Hayne royal commission in 2018.

The companies named in the notice of filing are AMP Superannuation, NM Superannuation Proprietary, AMP Life Limited (which is now owned by Resolution Life Group but was part of AMP when the conduct took place), AMP Financial Planning Proprietary and AMP Services.

According to the regulator, the accused entities did one or more of the following:

deducted life insurance premiums from 2069 deceased customers’ superannuation accounts despite being notified that the customer had died;

deducted financial advice fees from deceased customers’ superannuation accounts despite being notified that the customer had died;

failed to ensure that a system was in place that ensured that it did not charge deceased customers;

failed to ensure that a system was in place to manage conflicts of interest between the AMP companies’ interests in continuing to charge premiums and advice fees and members’ interests in premiums and advice fees ceasing after death and

contravened their overarching obligations as Australian financial services licensees to act efficiently, honestly and fairly.

The AMP companies’ conduct demonstrated a system of conduct or pattern of behaviour that was, in all the circumstances, “unconscionable”, ASIC says.

Their actions led to them receiving more than $500,000 in insurance premiums from the super accounts of deceased customers and more than $100,000 in advice fees.

“ASIC brings this claim in respect of 2069 deceased members affected by the retention of premiums, and 27 members affected by the retention of advice fees,” ASIC says in its concise statement filed to the court.

Mr Cullen says when the issues were discovered, the business immediately moved to change its processes and systems and took action to ensure the beneficiaries of customers impacted were fully remediated.

The business remediated 10,155 customer accounts a sum of $5.3 million for the period from 2011 to 2019, which included compensation for lost earnings. The remediation was completed in May last year.

“AMP apologises to all customers and beneficiaries who were impacted by this matter,” Mr Cullen said.

Click here for the notice of filing.