NextGen Financial Group to be wound up
After seeing dwindling numbers of advisers and losing a Federal court case regarding an unpaid AFCA determination, NextGen Financial Group is to be wound up.
In July, the firm was ordered by the Federal Court to pay an SMSF trustee $270,000 over an unpaid AFCA determination regarding inappropriate financial advice.
In the Federal Court, NextGen argued the debt was not due and payable as an AFCA determination does “not have the effect of creating a debt enforceable by the way of statutory demand”.
But Justice O’Callaghan ruled NextGen must now pay $270,523.67 to the defendant.
The plaintiff in the case, WJ & V Drakoulis Super Pty Ltd, has now applied for NextGen to be wound up and a hearing will be held on 3 October.
A notification of application to wind up the company was published on the ASIC website on 30 August.
The firm has also seen significant drops in its adviser numbers, losing 23 in two weeks.
Research firm Wealth Data revealed a loss of 13 advisers for the licensee owner in the week to 7 September, having additionally lost 10 advisers the week prior.
The licensee had 75 advisers at the start of 2022, then began 2023 with 46 advisers. Numbers now sit at less than 20 compared to a peak of 123 in 2019.
Tracing back to its foundation in 1985, NextGen has undergone numerous ownership changes.
It was formerly owned by Beacon, a subsidiary of Linchpin Capital led by Peter Daly.
Linchpin collapsed in 2018 and Daly was banned in November 2019 from providing financial services for five years, alongside former directors Paul Raftery and Ian Williams, for failing to act in the best interest of investors in managed investment schemes under their control.
In June 2020, it was acquired by US private equity firm Genesis Financial, a global financial services company focused on fintech-powered wealth management and D2C lending platforms.
AUTHOR
Laura Dew
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About time. The amount of money they owe people including ATO, Staff, Adviser and Clients. There is no way they could continue.