A troubled history of DASS

dass Dixon Advisory E&P Financial Group Evans and Partners CSLR Parliament

5 July 2023
| By Laura Dew |
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As E&P appoints a new chief executive and the government brings in the Compensation Scheme of Last Resort (CSLR), Money Management has collated a timeline of events at the troubled Dixon Advisory and Superannuation Services (DASS).

September 2020 — ASIC commences civil penalty proceedings
ASIC commenced civil penalty proceedings in the Federal Court against Dixon Advisory for alleged conflicts, best interests failures, and inappropriate advice. ASIC alleged Dixon Advisory representatives failed to act in their clients’ best interests and to provide advice that was appropriate to the clients’ circumstances.

ASIC also alleged that, in giving the relevant advice, Dixon Advisory representatives knew or ought to have known there was a conflict between their clients’ interests and the interests of entities associated with Dixon Advisory within the Evans Dixon group and failed to give priority to the clients’ interests.

July 2021 — ASIC issues $7.2m penalty 
ASIC entered a conditional agreement with Dixon Advisory that would see the firm pay a $7.2 million penalty for breaches of the Corporations Act as well as a $1 million to pay ASIC’s costs of investigation and legal proceedings. This followed court-ordered mediation to resolve civil penalty proceedings commenced by ASIC in Federal Court in September 2020.

January 2022 — DASS goes into administration 
Dixon Advisory and Superannuation Services (DASS) was put into administration after its directors determined mounting actual and potential liabilities meant it was likely to become insolvent. 
These included claims against DASS being determined by the Australian Financial Complaints Authority (AFCA), penalties agreed between DASS and ASIC, and possible damages arising from representative proceedings led by Piper Alderman and Shine Lawyers. 

April 2022 — DASS loses AFSL 
The firm’s Australian Financial Services licence (AFSL) was suspended by ASIC in April 2022 after civil penalty proceedings were carried out by ASIC against Dixon Advisory in September 2021. 

August 2022 — ASIC recommends victims complain to AFCA
Former DASS clients were urged to make a complaint to AFCA if they had suffered a loss as a result of Dixon Advisory misconduct and were eligible for compensation under a potential Compensation Scheme of Last Resort (CSLR). 

September 2022 — Court fines DASS $7.2m 
DASS was fined $7.2 million by the Federal Court after six representatives failed to act in clients’ best interests and failed to provide advice appropriate to their clients’ circumstances. It was also ordered to pay ASIC’s legal costs of $800,000.  

The court found that on 53 occasions between October 2015 and May 2019, Dixon Advisory was the responsible licensee of six representatives who did not act in the best interests of eight clients when they advised these clients to acquire, roll over, or retain interests in the US Masters Residential Property Fund (URF) and URF-related products.

March 2023 — AFCA details 1,700 complaints received
After being urged to make complaints, AFCA shared it had received over 1,700 complaints regarding the collapse. This represented three-quarters of all complaints regarding investment and advice last year. However, less than 1 per cent of them had progressed as AFCA has been forced to put them on pause while it awaited a potential CSLR.

June 2023 — CSLR passes
Welcome news for DASS victims as the CSLR passed both houses of Parliament. AFCA said it would consider whether an ‘open’ complaint, including those relating to DASS, was within AFCA’s jurisdiction and within the scope of the CSLR.

Dixon Advisory would need to maintain AFCA membership until 8 April 2024 as complaints could only be made against firms that are members of AFCA. 

June 2023 — New CEO appointed at E&P
Ben Anderson, who had been tasked with addressing the legacy issues within Dixon Advisory and the fund management, announced he would be leaving the firm and be replaced by Ben Keeble.

Anderson has held the role since July 2019 and been managing director since November 2021. He will step down on 31 December 2023, the firm said in a statement to the ASX.

With the CSLR now on the horizon for victims, Dixon Advisory closed and E&P’s exit from real funds is expected to be finalised by the end of 2023. Hopefully this will be the end of the DASS saga.
 

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AUTHOR

Submitted by Always blame a… on Wed, 2023-07-05 09:41

How about investigate the origins of the Dixon’s dodgy MIS products. And
the AFSL Responsible Manager and the Directors of Dixon’s who were forcing the Advisers to flog the dodgy vertically owned MIS.
As per usual the low hanging Advisers are the only ones really attacked. Not saying they did a good job. But they were owned and controlled by Dixon’s directors and AFSL.
Yet again the masters of this disaster, Dixon’s directors, executives etc get ZERO BLAME.
As for ASIC they were informed of this dodgy MIS for 10 years and did nothing about it.
A total ASIC failure yet again.

Submitted by Simon on Wed, 2023-07-05 10:21

The even bigger question is, 'Why is the media not jumping all over Jones for backflipping on his pre election commitment to including Managed Investment Schemes in the CSLR???'
Here's a running start - Google 'Sterling First MIS', contact Jones and ask his office why have you turned your back on these people??
Headline - 'The CSLR is flawed before it even gets traction!!!'

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