Former Guardian Advice adviser permanently banned
The Australian Securities and Investments Commission (ASIC) has permanently banned a former Guardian Advice insurance adviser for operating under a business model that put his own interests ahead of his clients.
Victorian insurance adviser, Andrew Moroney, was an authorised representative of the Suncorp risk advice business between March 2006 and April 2014, during which time he failed to follow financial services laws in relation to a number of his clients.
Moroney was found to have recommended his clients annually replace one insurance policy with another, resulting in high upfront commissions each year for each insurance policy that he replaced.
Clients who entered into new policies every year were at risk of exclusionary periods or revised terms, the corporate regulator said.
ASIC found that Moroney:
- Failed to make thorough enquiries about the clients' circumstances before advising them to change their life insurance policy;
- Failed to make reasonable enquiries into insurance policies already held by clients, as well as alternative policies;
- Falsely claimed he had conducted research on alternative life insurance policies when he had not done so; and
- Put his commercial interests before that of his clients.
ASIC deputy chairman, Peter Kell, said it was unacceptable for advisers to replace insurance policies with the aim of increasing commissions without valid reason.
"It puts clients' coverage at risk and drives costs in the sector, which are ultimately borne by consumers," he said.
Moroney has the right to apply to the Administrative Appeals Tribunal for a review of ASIC's decision.
AUTHOR
Malavika Santhebennur
Recommended for you
Money Management examines the share price of financial advice licensees over one year to 31 March, with M&A actions in the final quarter having a positive effect for two licensees.
A $3.5 million settlement for victims of Melissa Caddick has been approved by the Federal Court following an initial agreement last December.
The Reserve Bank of Australia has delivered its first rate decision since the introduction of a new board structure last month.
Digital advice provider Otivo has launched an interactive tool, powered by artificial intelligence and Otivo’s own advice engine, to help answer client questions.
