Business ordered to refund $85,000 in ‘lost’ SMSF monies

Supreme-Court/SMSF/

17 May 2016
| By Anonymous (not verified) |
image
image
expand image

The Supreme Court of Western Australia has ordered a financial services business to pay over $85,000 of self-managed superannuation fund (SMSF) monies back to a client, after the company allegedly gave inappropriate and conflicted advice.

The court hearing proceedings initiated by the Financial Ombudsman Service (FOS), ordered that Utopia Financial Services Pty Ltd pay $85,756 plus interest back to the client who incurred a loss as result of the firm's advice.

The court heard that an authorised representative of Utopia allegedly gave Dr Shelley Craddock advice in November 2006, to roll her super ($59,887) out of an industry super fund, into a new SMSF, borrow money and invest in a private trust, of which the authorised representative was the corporate trustee.

The court was told the trust was then going to develop a strata development in Cottlesloe, but "as a result of the global financial crisis" there were difficulties in borrowing funds and buying "all the necessary strata units", Craddock then wanted to "exit her SMSF's investments" but was unable to do so.

The court ruling followed the FOS' investigation into the matter in 2012, and subsequent request for Utopia to pay the monies back to Craddock, something which had not occurred.

FOS had found that Utopia breached its obligation under the Corporations Act 2001 and that Craddock suffered a loss as a result of their breach.

Read more about:

AUTHOR

Recommended for you

sub-bgsidebar subscription

Never miss the latest news and developments in wealth management industry

MARKET INSIGHTS

So we are now underwriting criminal scams?...

2 months 3 weeks ago

Glad to see the back of you Steve. You made financial more expensive, not more affordable as you claim, and presided ...

2 months 3 weeks ago

Completely agree Peter. The definition of 'significant change is circumstances relevant to the scope of the advice' is s...

4 months 4 weeks ago

ASIC has suspended the Australian Financial Services Licence of a Melbourne-based financial advice firm....

1 week 5 days ago

The corporate regulator has issued infringement notices to three AFSLs whose financial advisers provided personal advice to a retail client while unregistered....

2 weeks 3 days ago

ASIC has released the results of its first adviser exam to be held in 2025, with 241 candidates attempting the test....

3 weeks 1 day ago

TOP PERFORMING FUNDS

ACS FIXED INT - AUSTRALIA/GLOBAL BOND