ASIC investigating property developers bungs to advisers
Reports that property developers are offering advisers commissions to promote their developments to self-managed superannuation funds (SMSFs) are being monitored by the regulator.
Speaking at the Financial Planning Association of Australia (FPA) Professional Congress on Friday, Australian Securities and Investments Commission senior executive leader, financial advisers, Louise Macaulay, warned that such payments were likely to be "conflicted".
"We've received information on property developers offering commissions to advisers to recommend investing in their property developments [to SMSF clients]," she said.
"This is likely to be conflicted remuneration if the advisers receive this… we've followed this up in instances we've become aware of it, and we haven't as yet uncovered any evidence that payments have actually been made, but it's something we're looking at."
Macaulay also flagged the regulator's concerns over unlicensed advice being provided by real estate agents in the SMSF sector.
"Where the agents engaged in this don't have a licence that's problem," she said.
"You don't need an AFSL (Australian Financial Services Licence) to provide advice in relation to property buying, but when you're saying it should be bought in a superannuation fund, then you cross the line and you fall into the regulatory regime.
"We took action recently in the Supreme Court of NSW in relation to a group of entities called Park Trent, and they were promoting the use of SMSFs to buy property.
"We haven't got final orders, but we've got a judgement that says this was unlicensed conduct, and we will be leveraging that to get the message out to the industry."
AUTHOR
Nicholas O'Donoghue
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