Australian Executor Trustees, the wholly owned subsidiary of IOOF, has agreed to pay plaintiffs in the Provident class action $44.25 million.
The class action against Provident Capital was settled by Slater and Gordon on behalf of 1,800 investors on 30 July.
Provident, a debenture fund that collapsed in 2012, was the responsibility of IOOF subsidiary Australian Executor Trustees (AET).
IOOF announced on the ASX yesterday that it had entered into a settlement with one of the representative plaintiffs, Mr Creigton, and that it would shortly enter into a similar agreements with Mr and Mrs Smith.
The settlements, which are subject to Supreme Court of NSW approval, will mean AET is obliged to pay the plaitiffs and group members $44.25 million.
However, IOOF said it and AET will continue to pursue a own class action against its insurers and insurance broker to judgement (if a satisfactory settlement cannot be reached).
“In pursuing those claims, AET and IOOF are seeking to recover from those parties up to the whole of the amount that they will be obliged to pay the plaintiffs and group members in the Provident proceedings,” said the ASX statement.
IOOF has also agreed to settle cross claims brought by AET against the auditors of Provident, PwC and HLB Mann Judd.
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