An Adelaide financial adviser has been banned for four years for entering false health information on applications for life insurance.
The Australian Securities and Investments Commission (ASIC) banned former BT Financial Group (BTFG) adviser, Michael Mahoney, after an investigation found he engaged in conduct that was misleading and deceptive.
Mahoney was employed in BTFG’s Westpac Scaled Advice Insurance business from October 2013 to July 2014 to provide general advice to retail clients on insurance products.
ASIC stated that during his period of employment, Mahoney entered false information regarding various clients’ health or health-risk factors in telephone applications for insurance policies issued by Westpac Life Insurance Services Ltd (WLIS).
ASIC also stated that Mahoney’s actions resulted in WLIS issuing policies to clients based on false information and assuming greater risks without having an opportunity to undertake an assessment of those risks. WLIS has agreed to honour the affected client policies.
The investigation and ban is part of ASIC’s ongoing Wealth Management Project, started in October 2014, and which focuses on the conduct of the financial advice firms within NAB, Westpac, CBA, ANZ, AMP and Macquarie.
As a result of the Project, 23 advisers, including Mahoney, have been temporarily or permanently banned with at least four advisers banned for inappropriate behaviour relating to life insurance products or advice.
This is what happens when ASIC allows retail products to be sold under General Advice. Its a call centre folks, but it is not clear whether Westpac was responding to persons calling the call centre to buy insurance ( I have seen no TV ads ) , or Westpac was data mining bank clients accounts looking for payments to other insurers, and calling customers. Of course in ASICs world data mining does not happen ( yes it does, see the Couper Case & CBA data mining ) and in ASICs world call centre operators act on a General Advice script and never cross the line to Personal Advice.
And this folks will be the norm when LIF destroys the capability of self-employed advisers to provide advice to Mum & Dad consumers, and the banks bring in their TV direct style products without underwriting and no possibility of successful claims. Not only will the banks flog those rubbish products via tellers and loans officers ( all with an ASIC General advice sanction ) but they will be data mining every PDC for life insurance from their customers accounts and harassing customers to change, while not being required to explain the product differences.
The only surprise in all of this is it probably happens more than detected where the call centre, driven by bonuses, “misinterprets “the answers provided to health questions.
Very interesting comments considering every week i see ‘personal advice’ advisers and financial planners being named and shamed also on Risk Info for similar unethical behaviors. Has NOTHING to do with general or personal advice it comes down to greed of the individual and their personal morals. Similarly disgusting is the churning all the ‘old boys’ have done throughout the years with no regard whatsoever for their clients best interests.
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