Former WealthSure adviser costs company $865k in compensation
Banned former adviser, Colin Oberg, has cost his former licensee WealthSure $865,000 in compensation, after the Federal Court of Australia backed calls from seven applicants that the company should compensate them for losses caused by his recommendations.
The clients alleged that Oberg — who was permanently banned for providing financial services in July 2012 - put funds they had invested based on his recommendations under his direct control, either in a personal bank account or in a business account controlled by him. In each case the money was lost, and the applicants claimed that WealthSure was liable to compensate them for the loss, court papers revealed.
Oberg was an authorised representative of WealthSure from 18 October 2004 until 30 September 2010, when then acting compliance manager, Kirsty Pawski, advised him by email that his authority had been revoked following a number of complaints from clients.
Court documents revealed that WealthSure took no apparent step to contact or notify Oberg's clients until a letter was sent to two of the clients on 25 July 2011, which was described as an "uninformative and anodyne communication" that could not be considered to represent any kind of warning of the potential consequences for the clients of what WealthSure knew by late September 2010.
The court found that "each of the applicants is entitled to relief by way of damages or compensation for the loss identified, plus interest from the date of those losses", awarding specified compensation totalling $865,000 to the applicants.
At the time Oberg was an authorised representative of WealthSure, the business was led by then chief executive and founding shareholder, Darren Andrew Pawski, and has since been sold to the Sentry Group, and is now operating under a new Australian Financial Services Licence.
AUTHOR
Nicholas O'Donoghue
Recommended for you
With the final tally for FY25 now confirmed, how many advisers left during the financial year and how does it compare to the previous year?
HUB24 has appointed Matt Willis from Vanguard as an executive general manager of platform growth to strengthen the platform’s relationships with industry stakeholders.
Investment manager Drummond Capital Partners has announced a raft of adviser-focused updates, including a practice growth division, relaunched manager research capabilities, and a passive model portfolio suite.
When it comes to M&A activity, the share of financial buyers such as private equity firms in Australia fell from 67 per cent to 12 per cent in the last financial year.
