ASIC’s Australian financial authority announced that former AFS DOD Bookkeeping PTY Ltd (in liquidation) license holder, previously equivalent to PTY LTD (Equiti FS), has been punished $ 11,030,000 after the Federal Court has found that the Federal Court Inappropriate “cookie cutter” tips.
The Equity FS paid $ 130,250 to bonuses to three financial advisers who provided customers advice to roll their super chapters (SMSFS) and use these funds to buy real estate through a relevant entity, Equiti Property Ltd.
The court found that in the event of 12 customers who provided evidence to the court, the advice provided were “Cutter Cookie” and failed to take into account the individual conditions or objectives of each customer.
The court also found that the bonuses paid to the three advisers, who were paid when the customers settled on property offered through Equiti owned, influenced the advice they provided and violated the fees.
Asic President Sarah Court said,
“Mismanagement that exploits retirement is a priority for the ASIC. In this case, the court found that the bonuses paid to advisers influenced the advice they provided, resulting in the bad financial results for consumers involved.
“The size of today’s sentence demonstrates the seriousness of this misconduct.”
In his decisions, Justice Goodman observed that “little or no attention was paid to the special conditions of the customers”, with customers not having enough time to understand the tips given to them and the tips are focused on “maneuvering customers on real estate markets via smsfs”.
His price said: “The breach of behavior was clearly deliberate and expanded to a period of several years.”
ASIC canceled the Australian Financial Service’s ASCITI FS license on November 7, 2024.
Background
The Equiti FS provided financial advice to customers and offered SMSF installation and administration services. A relative real estate licensee, the Equiti Property Pty Ltd, the Recommended Property for the Market and another relevant entity, Equiti Finance Pty Ltd, offered mortgages.
ASIC 575 SMSFS Report: Improving the quality of tips and members’ tips and experiences was published in June 2018. Identified the single -owned stores that tend to promote the purchase of specialized houses via an SMSF. ASIC concerned the conflicts of interests that may arise in such models, including representative remuneration structures.
ASIC informed its guidance on the conflict and other prohibited remuneration (RG 246) in December 2020. In July 2021, the Ministry of Finance published the ASIC report on the end of the clashes.
Conflicting remuneration laws prevent the payment and receipt of benefits that could reasonably be expected to influence the financial advice given to customers or the selection of financial products recommended to customers.
The ASIC has released an informative newsletter 274 tips on providing advice on the Superranmuation Fund Fund in December 2022 to help advice providers comply with their legal obligations when providing advice on self -promoting retirement funds (SMSF).
Asic’s MoneySmart site has consumer information about financial tips, including the choice of a financial adviser, understanding if an SMSF is suitable for you and SMSFs and property.