ASIC bans Melbourne adviser
The Australian Securities and Investments Commission (ASIC) has banned Melbourne adviser Nizi Bhandari and cancelled the Australian financial services licence (AFSL) of The Australian Dealer Group (ADG).
Bhandari was permanently banned from providing financial services and engaging in credit activities, controlling a financial services or credit business, or performing any function in relation to carrying on a financial services or credit business.
Bhandari was an authorised representative, sole director, responsible manager and key person of ADG between November 2017 and December 2020.
ASIC found Bhandari acted dishonestly while assisting consumers to find and consolidate their superannuation and obtain hardship payments.
This had included instances where he told consumers to make false statements to their superannuation fund trustees in order to gain early access to their superannuation balances.
ASIC also found that he and ADG gave personal advice to consumers about their superannuation despite only being authorised to give general advice and failed to comply with the legal obligations required, which included client best interest and providing a statement of advice.
ASIC cancelled ADG’s AFSL, after it found its business model was not designed to comply with its obligation to act efficiently, honestly or fairly when providing financial services. ADG was found to have:
- Prioritised its own interests over the consumers’ interests;
- Breached the Australian Tax Office’s (ATO’s) terms and conditions when conducting lost superannuation searches;
- Acting without the consent or instruction of consumers;
- Charged fees for superannuation consolidation on an ad hoc basis, without transparency, fairness or consistency; and
- Pressured consumers into signing Superannuation Consolidation Agreements over the phone, which included not providing time to read its terms and conditions prior to seeking agreement.
ASIC said as a consequence of this conduct consumers were potentially exposed to harm, which included loss of insurance held through superannuation, extra fees and ATO penalties for inappropriate access to superannuation.
Bhandari and ADG had the right to appeal to the Administrative Appeals Tribunal (AAT) for a review of ASIC’s decisions.
Bhandari’s banning would be recorded on ASIC’s Financial Advisers Register and the Banned and Disqualified Persons Register.
AUTHOR
Chris Dastoor
Recommended for you
Digital advice tools are on the rise, but licensees will need to ensure they still meet adviser obligations or potentially risk a class action if clients lose money from a rogue algorithm.
Shaw and Partners has merged with Sydney wealth manager Kennedy Partners Wealth, while Ord Minnett has hired a private wealth adviser from Morgan Stanley.
Australian investors are more confident than their APAC peers in reaching their financial goals and are targeting annual gains of more than 10 per cent, according to Fidelity International.
Zenith Investment Partners has lost its head of portfolio solutions Steven Tang after 17 years with the firm, the latest in a series of senior exits from the research house.
