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Don’t single us out, says IOOF chairman

Don’t single us out, says IOOF chairman

Tim Stewart
— 1 minute read

IOOF’s failure to sack its head of adviser research after issuing him with two ‘first and final warnings’ reflects widespread financial services HR practice, says IOOF chairman Roger Sexton.

Mr Sexton appeared before a hearing of the Senate Economics Committee alongside IOOF head of investigations Rob Unwin and general manager for human resources Danielle Corcoran in Sydney yesterday.

Labor Senator Sam Dastyari, who is the chairman of the Senate committee's Scrutiny of Financial Advice inquiry, asked the IOOF executives a series of questions about IOOF head of advice research Peter Hilton.

Mr Hilton, who Ms Corcoran confirmed is currently on sick leave and still employed by IOOF, has been the subject of a series of Fairfax articles alleging front running and insider trading at IOOF.

Nationals Senator John Williams used parliamentary privilege on 25 June 2015 to air a number of allegations against Mr Hilton, noting that he had received two 'first and final warnings' from IOOF's HR department.

The first warning in 2009 related to performance figures in adviser research models, while the 2014 warning related to cheating on examinations.

In a public hearing on 7 July 2015 IOOF managing director Chris Kelaher said it was possible for IOOF employees to receive 'first and final warnings' on different matters without being dismissed as a result.

Ms Corcoran confirmed yesterday that management can disregard a previous 'first and final warning' if it has "grown stale".

Mr Sexton said he wanted to "put the issue to bed", noting that it has been a subject of "mirth" in the financial press.

"[This issue has its genesis in] the ability in the finance industry to be able to get 'first and final warnings' on different aspects of the job," Mr Sexton said.

"It’s not an issue for IOOF, it’s an issue for the financial services sector ... this exists across the board in the financial services market."

Mr Unwin told the Senate committee that Mr Hilton and his department were investigated two times.

"The [2009] allegation was that the [advice modelling] performance numbers were incorrect and they’d been used within the network in presentations [by advisers]," Mr Unwin said.

"The numbers themselves were placed on a hypothetical portfolio of investments and no IOOF partners were part of that. The review that was undertaken on those numbers was not conclusive that they were incorrect."

However, under questioning by Senator Dastyari Mr Unwin accepted there were some inaccuracies in the hypothetical portfolio modelling.

"The actual criteria that was used from the analysts within the research department highlighted some areas that probably weren’t taken into account in the hypothetical model," Mr Unwin said.

 

Don’t single us out, says IOOF chairman
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