Fong Financial Planners has pleaded guilty to three charges of dishonest conduct in the Perth Magistrates Court.
Whilst serving as an authorised representative of AMP in 2014, the advice firm acted dishonestly by recording false information on forms submitted to AMP as part of client insurance applications.
Fong Financial Planners intentionally withheld all relevant information relating to the personal circumstances of the clients, included health and medical details.
If AMP had received this information from the firm, it could have requested further medical assessments and questionnaires, meaning exclusions could have applied to some of the insurance policies.
The withheld information by Fong Financial Planners meant the duty of disclosure owed by the clients to the insurer had not been met and they carried the risk of not being covered by AMP.
The company and its director, former financial adviser David Fong, were initially charged with 11 offences contrary to the Corporations Act. The charges against Fong and eight of the charges against Fong Financial Planners were discontinued following Fong Financial Planners’ pleas of guilty to the three charges.
The maximum penalty for a company for engaging in dishonest conduct while providing financial advice and carrying on a financial services business was a fine of either $7,650,000 or three times the total value of the benefits reasonably attributable to the offence, or 10% of turnover in the 12-month period ending at the end of the month in which the offence was committed.
On 19 May, 2023, the matter was committed to the District Court of Western Australia for mention to fix a date for sentence.
The Commonwealth Director of Public Prosecutions was prosecuting the matter, following a referral from Australian Securities and Investments Commission (ASIC).
What an absolutely ridiculous level of fines – $7.65 million.
What was the fine for Rio Tinto blasting a historic aboriginal site to smithereens? Nothing.
What was the fine for Rio Tinto dropping radioactive material along the highway? $2,000
What’s the fine for driving drunk and killing/maiming someone – not a lot.