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ASIC hands out bans, restrictions in super moves this week

ASIC hands out bans, restrictions in super moves this week

The corporate regulator has had superannuation in its sights this week, handing out a five-year ban to a former CBA financial adviser and accepting an EU from a popular loan provider.

Tax&Compliance Reporter 19 January 2018

ASIC announced yesterday it banned Kimberley Holgate of Wagga Wagga, NSW, from providing financial services for five years. Ms Holgate was an authorised representative of Commonwealth Financial Planning Limited from January 2014 to October 2015.

ASIC found that Ms Holgate engaged in conduct that was likely to mislead – cutting clients’ signatures from documents held on file and pasting them onto new documents.

It also found that she did not act in the best interests of her clients when advising they roll over their existing super to a new product issued by Colonial First State, a related entity of the Commonwealth Bank of Australia.

She also failed to act in the best interests of her clients when advising them to cancel existing insurance policies and apply for personal insurance issued by CommInsure, and when telling them to acquire financial products which entitled her, her employer and its related entities to a financial benefit, said the corporate regulator.

“The super advice provided by Ms Holgate did not result in any improvement to the clients’ current financial position,” said ASIC.

Further, ASIC also announced it has accepted an enforceable undertaking (EU) from Duane Wright and his business, First National Home Loans and Insurance Pty Ltd.

According to ASIC, Mr Wright failed to undertake adequate inquiries into the relevant personal circumstances of some clients to whom he made recommendations to switch life insurance policies and also failed to provide adequate replacement product advice in the Statement of Advice, preventing the client from making an informed decision to switch life insurance and superannuation products.

ASIC said that Mr Wright advised purchasing life insurance that was too expensive for the client, failed to consider the longer-term impact on retirement savings of placing life insurances within superannuation, and failed to provide accurate information about the client’s circumstances within the Statement of Advice.

Under the EU, Mr Wright and First National have agreed to undergo additional training in relation to the provision of financial product advice and must adhere to strict supervision requirements for 12 months, with all their advice audited by the authorising licensee before it is provided to clients.

ASIC hands out bans, restrictions in super moves this week
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