Former Guardian Advice adviser permanently banned
The Australian Securities and Investments Commission (ASIC) has permanently banned a former Guardian Advice insurance adviser for operating under a business model that put his own interests ahead of his clients.
Victorian insurance adviser, Andrew Moroney, was an authorised representative of the Suncorp risk advice business between March 2006 and April 2014, during which time he failed to follow financial services laws in relation to a number of his clients.
Moroney was found to have recommended his clients annually replace one insurance policy with another, resulting in high upfront commissions each year for each insurance policy that he replaced.
Clients who entered into new policies every year were at risk of exclusionary periods or revised terms, the corporate regulator said.
ASIC found that Moroney:
- Failed to make thorough enquiries about the clients' circumstances before advising them to change their life insurance policy;
- Failed to make reasonable enquiries into insurance policies already held by clients, as well as alternative policies;
- Falsely claimed he had conducted research on alternative life insurance policies when he had not done so; and
- Put his commercial interests before that of his clients.
ASIC deputy chairman, Peter Kell, said it was unacceptable for advisers to replace insurance policies with the aim of increasing commissions without valid reason.
"It puts clients' coverage at risk and drives costs in the sector, which are ultimately borne by consumers," he said.
Moroney has the right to apply to the Administrative Appeals Tribunal for a review of ASIC's decision.
Recommended for you
A financial advice firm has seen a weekly decline of 10 advisers, with all moving to a new licensee, while Centrepoint Alliance continues its “growth story”.
Sequoia Financial Group has seen a top-level reshuffle as the chair of the board, John Larsen, steps down after five years in the position.
As statements of advice move into the rear-view mirror, Vital Business Partners explores how financial advisers are adopting innovative documentation strategies.
Adviser Ratings has explored whether there is a financial benefit to advice firms seeking to have a specialised client base in terms of client assets and fees charged.