Former Westpac adviser banned
The Australian Securities and Investments Commission (ASIC) has banned former BT Financial Group (BTFG) financial adviser from providing financial services for four years for misleading and deceptive conduct.
Michael Mahoney was employed by BTFG in the Westpac Scaled Advice Insurance business from October 2013 to July 2014 to provide only general advice to retail clients on insurance products.
However, ASIC's investigation, which was part of its Wealth Management Project established in October 2014, found that during this period Mahoney entered false information about various clients' health or health-risk factors in telephone applications for insurance policies issued by Westpac Life Insurance Services (WLIS).
As a result, WLIS issued policies to clients based on false information and assuming greater risks without having a chance to assess those risks.
WLIS has agreed to honour the affected client policies.
A BT spokesperson said the firm ceased Mahoney's employment in July 2014 after its internal controls detected the deceptive conduct. It added that it voluntarily reported Mahoney to ASIC and supported the corporate regulator's decision.
"We have always taken our responsibility to our customers and our ASIC reporting obligations very seriously and we do not tolerate advisers who do not meet our standards," the spokesperson said.
"There was no adverse customer impact and all policies were honoured."
ASIC deputy chairman, Peter Kell, said: "This outcome shows that ASIC expects employees who are providing financial services to maintain high standards and not engage in conduct that is misleading and deceptive".
Mahoney has the right to appeal to the Administrative Appeals Tribunal for a review of ASIC's decision.
ASIC's Wealth Management Project has previously resulted in the banning of two other Westpac authorised representatives, including Victorian financial adviser from Magnitude Group Pty Ltd, Amanda Ritchie, and former Westpac financial planner, Martin Hodgetts.
AUTHOR
Malavika Santhebennur
Recommended for you
Three of Australia’s largest financial advice groups have shared their thoughts with Money Management on whether they would include crypto on their approved product lists.
Shadow treasurer Angus Taylor has vowed to introduce a bill to legislate a raft of financial services reforms if the Coalition is elected.
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.
