TheAustralian Securities and Investments Commission (ASIC)has banned two former Saxby Bridge Financial Planning representatives for a total of six years after investigations revealed both planners had breached the law on more than one occasion.
Mark Patrick Erichsen and David Charles Steer have been banned from acting as a representative of a dealer or an investment adviser for four and two years respectively.
An ASIC investigation found a number of breaches of the law in Erichsen’s advice to some clients between 18 November 1996 and 2 July 2001.
The investigation found that Erichsen failed to document the financial and personal details of certain clients sufficiently to adequately assess and make appropriate investment recommendations.
He also placed incorrect statements in recommendation reports to justify recommending high risk tax driven managed business investments, and failed to understand the meaning of diversification, which resulted in some clients investing in too many high risk tax driven managed investments.
In similar circumstances, Steer was banned after ASIC found he had also breached the law in his advice to certain clients between 18 November 1996 and 4 July 2001.
An ASIC investigation into Steer’s financial undertakings found he failed to adequately assess his clients’ risk profiles so that certain clients were recommended inappropriately high risk investments. Steer also failed to adequately advise his clients of the possibility that tax deductions on certain tax-driven investment schemes could be rejected by the Australian Tax Office and the impact such a consequence would have on their future financial position.
The regulator also found Steer had failed to ensure that client loan application documents were completed accurately, which resulted in a risk of loans being approved for investments that certain clients later could not afford.
During the investigation, ASIC found that both advisers had also failed to adequately disclose all of the commissions and benefits they might receive from a client taking up a particular investment recommendation.