The SMS Advising Group has had its Australian Financial Services Licence revoked by the Australian Securities and Investments Commission (ASIC).
In addition, director of the group Barbara Cavanough has been banned from providing financial services advice for 10 years.
These actions are the result of ASIC’s super switching campaign in late 2004 and early 2005, which discovered the SMS Advising Group had failed to comply with its legal obligations and would be unable to comply in the future.
This included failures to provide Statements of Advice and deal properly with conflicts of interest.
In particular, ASIC said it was concerned with Cavanough’s association with two unregistered managed investment schemes — the Maypole Secure Income Fund and Maypole Baker. Cavanough’s husband was a director of the latter company.
ASIC executive director, enforcement, Jan Redfern said: “ASIC was concerned that these relationships were not properly disclosed to clients of SMS Advising Group.
“ASIC will take action against financial services providers that do not properly manage conflicts of interest to ensure they put the interests of their clients above their own.”
The SMS Advising Group was also found to have inadequate compliance and complaints handling procedures, and had failed to lodge financial records with ASIC.
Cavanough and the SMS Advising Group have the right to appeal to the Administrative Appeals Tribunal for a review of the ASIC decision.
