ASIC bans risky adviser
TheAustralian Securities and Investments Commission(ASIC) has banned a South Australian financial adviser from acting as a representative of a securities dealer or investment adviser for three years.
ASIC was concerned about the advice the planner, Shane David Holmes of Frewville in South Australia, had given to thirteen clients who invested over $520,000 in two high risk schemes not approved by Holmes’ proper authority provider, GWM Adviser Services.
The high risk schemes were described as 'fractional reserve banking' schemes, promising investors returns of 7 to 10 per cent over 30 or 45 days.
Many of the investors Holmes encouraged into the schemes, as the sole practitioner and proprietor of his business Liberty Advisory Services, are yet to be repaid the funds they invested.
GWM suspended Holmes' proper authority in September 2002 upon discovering that he had recommended the schemes to clients, and cancelled it in February 2003.
ASIC found that Holmes failed to conduct any reasonable, adequate and independent investigation of the high risk schemes, and failed to advise GWM of his involvement in them.
The regulator also found he failed to keep proper files and records or if he did, failed to produce them when required to do so, and that he failed to discharge his duties as a representative of GWM honestly and fairly.
“ASIC will continue to take action to protect the public from advisers who do not act efficiently, honestly and fairly, as required by the law,” ASIC's director of enforcement Mark Steward says.
Recommended for you
The FSCP has announced its latest verdict, suspending an adviser’s registration for failing to comply with his obligations when providing advice to three clients.
Having sold Madison to Infocus earlier this year, Clime has now set up a new financial advice licensee with eight advisers.
With licensees such as Insignia looking to AI for advice efficiencies, they are being urged to write clear AI policies as soon as possible to prevent a “Wild West” of providers being used by their practices.
Iress has revealed the number of clients per adviser that top advice firms serve, as well as how many client meetings they conduct each week.
