Australian wealth manager IOOF says class action to end without payouts

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The Melbourne-based firm was sued in April 2019 by shareholders who alleged the company engaged in deceptive conduct and breached stock market disclosure obligations.

The suit was filed in the New South Wales Supreme Court in Sydney by law firm Quinn Emmanuel.

The class-action lawsuit was among many filed against financial firms after a public inquiry in 2018 – dubbed the Royal Commission – uncovered widespread misconduct in the finance industry, including charging customers for service not rendered and the deception of regulators.

IOOF said it would make no payments to the plaintiffs, their lawyers, financial backers or any other members of the class action as part of the settlement. It did not provide details on how the agreement was reached.

Quinn Emmanuel did not immediately respond to a request for comment.

Shares of IOOF rose as much as 5.5% to a two-week high of A$4.570, against a 1.7% rise in the broader market (AXJO).

The agreement brings additional relief to IOOF, which was among the worst affected by the Royal Commission inquiry.

In September, the banking watchdog lost a landmark case after a court ruled it had not proved its case alleging the wealth manager had breached pension law.

By that time, the firm had lost half its market value and suffered the departure of its top executives.

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