Financial Recovery Technologies Fast Five provides you with the top news in shareholder class actions. Stay up-to-date on the latest developments in settled (U.S./Canada) claims filing opportunities, Antitrust settlements, Global Group Litigation matters and more. For more information, contact your Financial Recovery Technologies representative or email us.

1. AMP, CBA, Westpac Face Fresh Class Action Threat

Mid-tier law firm Piper Alderman is preparing to launch class action lawsuits against financial institutions including AMP, the Commonwealth Bank and Westpac for payment of conflicted remuneration to financial advisers. It is understood a number of suits against financial services providers are imminent relating to alleged contraventions of the laws brought under the Rudd-Gillard Labor government’s Future of Financial Advice (FoFA) reforms in 2012. The controversial reforms banned the payment of investment commissions, introduced a duty for financial advisers to act in the best interests of clients and added a raft of disclosure and administrative requirements. Click here to read the full article (subscription may be needed).

2. After a Rocky Class Actions Inquiry, Let the Haggle Begin

The parliamentary joint committee inquiry into litigation funding has finished its public hearings and will report in December. It was a rocky ride – 93 submissions and questions that could look like surgical strikes or careering cannonballs. It was the politicians v funders, lawyers, academics, think tanks and anyone else who came along. So, what do we draw from the last few weeks? Everyone accepted the need for some form of litigation funding, but the key points were regulation, legislative change and the remuneration of funders and lawyers. Click here to read the full article (subscription may be needed).

3. Institutional Investors Look for Recourse from Wirecard

Munich-based Wirecard AG imploded in June 2020 after its long-time auditor EY GmbH (EY) would not sign off on its 2019 accounts over fund verification, admitting that €1.9 billion in cash receipts probably never existed. That revelation set off dominoes which led to the eventual fall of Wirecard. Wirecard subsequently filed for insolvency owing debts of €3.2 billion, with firm executives being arrested on suspicion of fraud and racketeering. Litigation funding giant Omni Bridgeway (UK) Limited (Omni Bridgeway) announced its planning to financially back potential litigation on behalf of shareholders in Wirecard against EY alleging a series of deficient audits and seeking damages as a result. Click here to read the full article.

4. Australia: Changes to the Regulation of Third Party Litigation Funding – Insolvency Practitioners Should Take Note

Litigation funders in Australia are now subject to increased regulation following the passing of the Corporations Amendment (Litigation Funding) Regulations 2020 (Cth). The amendments apply to schemes or arrangements entered into on or after 22 August 2020. Importantly, these amendments retain the current exemptions for funding arrangements in the insolvency context now called ‘insolvency litigation funding schemes’. But Insolvency practitioners should take note of the strict qualifying criteria, or otherwise risk classification of their funding arrangements as a Managed Investments Scheme under the Corporations Act 2001 (Cth) (Act). Click here to read the full article.

5. China Launches Class-Action Lawsuit System for Its 167 Million Securities Investors

On Friday, 31 July 2020, the Supreme People’s Court of China (SPC) held a press conference and released the Provisions on Issues of Representative Securities Litigation, effective immediately, marking the launch of a class-action lawsuit system with “Chinese characteristics”. The China Securities Regulatory Commission (CSRC) also issued a Notice on Investor Protection Institutions Participating in Special Representative Securities litigation on the same day. Click here to read the full article.

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