A class action brought against one of Australia's largest financial advice firms over allegations it provided conflicting advice or charged fees for no service has failed.
The Federal Court of Australia on Tuesday dismissed a class action claim against Count Financial (ASX:CUP), which was a wholly owned subsidiary of Commonwealth Bank of Australia (ASX: CBA) until 1 October 2019.
The class action was filed by law firm Piper Alderman on behalf of people who had acquired, renewed or continued to hold financial products, insurance products and platform products on the advice of a Count Financial adviser.
“Count Financial defended the claim and denied any wrongdoing,” Count said in an ASX announcement.
The action alleged Count Financial contravened its legal obligations by failing to ensure its advisers acted in their clients’ best interests and prioritised their clients’ interests when giving advice and receiving commissions and/or benefits and that advisers charged some clients fees without providing ongoing service.
Charging fees for no service and receiving conflicted remuneration and incentives were among the major findings made against some financial planning firms in the Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry which released its final report in February 2019.
The trial of the class action claim before Justice John Halley of the Federal Court ran for three weeks in March 2024 with the judge reserving his decision.
In handing down his decision on Tuesday, Justice Halley said Count did not owe fiduciary duties to the applicant in the relevant period of advice or was not otherwise liable for any alleged breach of fiduciary duties by the applicant’s representatives.
He said the applicant had not established that Count contravened its statutory supervisory obligations or engaged in any misleading or deceptive conduct.”
Piper Alderman was approached for comment but had not responded by the time of writing.
Count Financial shares closed 0.5 cents (0.63%) higher at 80 cents on Tuesday, capitalising the company $134.60 million.
