AMP's head of financial advice has lost count of the number of times the company misled corporate regulator ASIC over charging customers fees for no service, he has told the financial services royal commission.

The financial services company is the first institution to be questioned by the commission over the fee-for-no-service scandal, which also involves the four major banks.

The five institutions are paying out a combined $216 million in refunds to more than 300,000 customers who were charged fees for financial advice services they never received.

While the Commonwealth Bank accounts for more than half of that compensation bill, AMP has faced an intense grilling over what it told the Australian Securities and Investments Commission (ASIC) when the regulator investigated the issue.

AMP's group executive for advice Anthony 'Jack' Regan yesterday afternoon admitted to the commission that the company had misled ASIC by presenting fee-for-no-service as a mistake, when there was a deliberate policy to charge customers fees for 90 days even when they were in a pool that received no advice services.

This morning the commission heard many more instances where AMP had made false or misleading statements to the regulator about fee-for-no-service and its efforts, or lack thereof, to stop the practice.

At times, the hearing became comical as Mr Regan lost track of how many times AMP had deceived ASIC.

"By my count this was the 14th false or misleading statement by AMP to ASIC? [Pause] You're losing count," said senior counsel assisting the commission Michael Hodge, to laughter in the hearing room.

"I'm in your hands in that regard, Mr Hodge," Mr Regan replied.

"I know, there's so many you'll have to rely on my count Mr Regan," Mr Hodge quipped.

The count of letters and other statements where AMP misled ASIC kept rising over the first hour of today's hearings, prompting another farcical exchange.

"I think that takes us to 17 false or misleading statements by my count, Mr Regan," said Mr Hodge at one point. "Were you counting that as one or two?" Mr Regan replied. "I only counted that as one, do you think I should count it as two?" "I think in fairness Mr Hodge you should." "OK. The 18th false or misleading statement by AMP to ASIC."

Later in the hearing, the count rose to at least 20 times where AMP had made false or misleading statements to the regulator.

The result is that fees were charged to customers not receiving any advice services years after the problem was first identified.

Board made changes to law firm's 'independent review'

The other major revelation from Mr Regan's evidence was that AMP's board had ordered changes to an "independent review" of the fee-for-no-service scandal being performed by law firm Clayton Utz, and that those changes were made.

Senior counsel presented an avalanche of emails and other documents showing how AMP executives repeatedly asked Clayton Utz to modify aspects of the report to downplay the knowledge and responsibility of some senior executives.

Most notably, Mr Hodge pointed out changes to a final version of the report which included a new paragraph that said chief executive Craig Meller was not aware of the 90-day exception and was also unaware of legal advice obtained by AMP showing this was against the law.

Mr Regan made the startling admission, seemingly by accident, when asked about how that paragraph had come to be added to the Clayton Utz report.

"There were a number of changes, as I recall, that were submitted as part of the version that the board finally approved," he said. "I'm sorry, are you saying the board met and approved changes to the report?" Mr Hodge asked incredulously. "I believe there was a paper submitted to the board where they approved a final round of changes, which I believe includes that paragraph," Mr Regan replied without hesitation. "Why would the board be approving changes to an independent report?" Mr Hodge pressed, followed by a very long pause. "Uh, because it was a report being accepted by the board," was the eventual answer.

'Preferenced shareholders at the expense of clients'

AMP admitted to cultural problems within parts of the organisation, where staff put short-term profits ahead of customer welfare and legal obligations.

"I think there are reasons to be concerned," Mr Regan conceded. "I think they show a culture that's not as robust as it should be." "When you say, 'not as robust as it should be', that really understates it doesn't it?" Mr Hodge pressed. "I think that the culture certainly needs to be reviewed and analysed, and we are doing that."

Commissioner Kenneth Hayne made an observation in the first block of hearings that some actions by the banks indicated "that there's a trade-off between administrative convenience and obeying the law."

Senior counsel assisting Michael Hodge QC appeared to channel Mr Hayne's sentiment in further questioning of AMP.

"What we seem to be seeing is that a conscious decision is made to protect the profitability of AMP at the expense of complying with AMP's licence, do you agree?" he asked.

"Yes, I believe that's what that shows," Mr Regan conceded.

The AMP executive then admitted that the practice of charging customers fees for 90 days when they were receiving no services showed that the customers' interests were not always put first.

"It's clear that we preferenced the interests of shareholders, in that exchange, at the expense of clients, and so that is a concern," he admitted.

An AMP report, read out by Mr Hodge, revealed the company thought letting customers know about the deliberate fee-for-no-service practices "would be a very negative customer experience."