IOOF faces a class action over the beleaguered wealth manager's alleged failure to tell shareholders about APRA's concern over possible breaches of superannuation laws.
Sydney law firm Quinn Emanuel, backed by litigation funder Regency Group, launched the action on Monday citing financial services royal commission evidence that IOOF subsidiaries allegedly breached their trustee duties, and that directors and officers knew about it.
Quinn Emanuel will allege that, between May 27 and December 6 last year, IOOF breached its continuous disclosure obligations to shareholders.
On December 7, the Australian Prudential Regulation Authority moved to disqualify IOOF's top brass and impose new licence conditions, saying it had concerns dating back to 2015 and that IOOF had consistently failed to address them.
IOOF shares lost more than 35.84 per cent on the day the APRA action was made public.
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"Quinn Emanuel's class action will allege that IOOF was aware that its conduct would have significant legal and regulatory risks," Quinn Emanuel said.
"IOOF is alleged to have breached its continuous disclosure obligations and engaged in misleading or deceptive conduct."
The class action is open to shareholders who acquired shares during the period in question.
IOOF managing director Christopher Kelaher and chairman George Venardos went on leave in December following the APRA allegations, and interim chairman Allan Griffiths said IOOF would vigorously defend "misconceived" accusations.
IOOF shares were worth $6.37 before the start of trade on Monday, still 11 per cent down on their December 6 close.
