ASIC concerns prompt Westpac advertising changes
Following concerns raised by the Australian Securities and Investments Commission (ASIC), Westpac Banking Corporation will undertake a review of its marketing of geared investments strategies which use the phrase 'stress-free'.
ASIC was concerned that financial products were being advertised in print media, online and within a brochure using the phrase 'Stress-free strategies to accelerate your wealth - A guide to borrowing to invest in shares.'
Despite Westpac's promoted strategies having relatively low gearing, customers could potentially be misled by the term 'stress-free' because there are inherent risks involved in gearing to invest in shares, ASIC stated.
"'Stress-free' is a quite powerful claim, and in the context of not wanting to create unrealistic expectations that can lead to poor investments decisions, ASIC considered the use of the phrase to be inappropriate, particularly in a volatile market environment," said ASIC commissioner Peter Kell.
Westpac has agreed to cease using the phrase 'stress-free' in its marketing in response to the issues raised by the commission.
In August, ASIC released a consultation paper and draft regulatory guide (CP167) which outlines best practice guidance for the advertising of financial products and services.
Recommended for you
ASIC has launched court proceedings against the responsible entity of three managed investment schemes with around 600 retail investors.
There is a gap in the market for Australian advisers to help individuals with succession planning as the country has been noted by Capital Group for being overly “hands off” around inheritances.
ASIC has cancelled the AFSL of an advice firm associated with Shield and First Guardian collapses, and permanently banned its responsible manager.
Having peaked at more than 40 per cent growth since the first M&A bid, Insignia Financial shares have returned to earth six months later as the company awaits a final decision from CC Capital.
