A former Apogee Financial Planning adviser has been handed a four-year ban for failing to provide appropriate advice. Meanwhile, a former GPS Wealth representative has been banned for three years for similar misconduct involving insurance products.
Former Sydney-based financial adviser Adrian Khaw is facing a four-year ban from providing financial services after ASIC surveillance found he failed to act in his clients' interests, comply with the best interests duty and to provide appropriate advice.
Khaw, a former authorised representative of Apogee, was not adequately trained or competent to provide financial services and was found to have backdated file notes, ASIC said.
The regulator reviewed files of clients that wanted to purchase an investment property and were referred to Khaw by an associated mortgage broker. Despite their differing needs and circumstances, Khaw advised almost all of them to establish a self-managed superannuation fund or use an existing SMSF and to then use a limited recourse borrowing arrangement to purchase a property.
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In doing so, Khaw failed in his duty to implement a strategy that was in the best interests of the clients, ASIC said.
He also failed to provide a professional, independent assessment of whether an SMSF which borrowed to invest in property was appropriate.
Khaw put his own interests ahead of his clients' and exposed a number of them to financial harm, the regulator said.
Khaw was an authorised representative of Apogee from 2015 to 2018. Prior to this he was licensed by ANZ and, before that, IOOF. According to the ASIC Financial Adviser Register, Khaw is a certified financial planner and member of the Financial Planning Association of Australia.
Meanwhile, ASIC has also banned former Queensland adviser Mark Alexander Rothnie.
Rothnie was banned for three years for failing to act in his clients' best interests and failing to provide appropriate advice.
Surveillance by ASIC found Rothnie failed to properly investigate and document his clients' relevant financial and personal circumstances. He also failed to give adequate consideration to their existing insurance products before making a recommendation to switch, which resulted in his clients being worse off.
Rothnie is a former authorised representative of GPS Wealth and has also previously been licensed by Beacon Financial Group subsidiary The FinancialLink Group. According to the Tax Practitioners Board website, he is a member of the Association of Financial Advisers.
Commenting, ASIC commissioner Danielle Press said: "Financial advisers are expected to understand their clients' personal circumstances and take those circumstances into consideration when providing personal advice."
"When recommending that clients switch from an existing life insurance product, advisers must fully consider the risks of the switch and if it is necessary to meet the clients' goals and objectives."
ASIC will continue to take action where advisers are found to be breaking the law, Press added.
"Advisers have a legal obligation to prioritise their clients' interests and to comply with the best interests duty when providing personal advice," she said.