{"id":62678,"date":"2022-09-20T13:11:50","date_gmt":"2022-09-20T03:11:50","guid":{"rendered":"https:\/\/riskinfo.com.au\/news\/?p=62678"},"modified":"2022-09-20T13:11:50","modified_gmt":"2022-09-20T03:11:50","slug":"advisory-firm-penalised-for-breaches-of-best-interest-obligations","status":"publish","type":"post","link":"https:\/\/riskinfo.com.au\/news\/2022\/09\/20\/advisory-firm-penalised-for-breaches-of-best-interest-obligations\/","title":{"rendered":"Advisory Firm Penalised for Breaches of Best Interest Obligations"},"content":{"rendered":"

The Federal Court has imposed a $7.2 million penalty on Dixon Advisory and Superannuation Services after six representatives failed to act in their clients\u2019 best interests and failed to provide advice appropriate to their clients\u2019 circumstances.<\/p>\n

ASIC Deputy Chair Sarah Court<\/strong> says in a statement that licensees need to ensure their representatives are taking into account their clients\u2019 specific needs and circumstances.<\/p>\n

\"\"<\/a>
Sarah Court …licensees need to ensure their representatives are taking into account their clients\u2019 specific needs and circumstances.<\/figcaption><\/figure>\n

\u201cAdvice that fails to reflect client circumstances \u2212 or advice models that lead to one-size-fits-all outcomes \u2013 are less likely to meet best interest duty obligations and can expose clients to a risk of capital loss,\u201d she says.<\/p>\n

ASIC says 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 and URF-related products.<\/p>\n

The Court found Dixon Advisory representatives did not conduct a reasonable investigation of the clients\u2019 circumstances before providing the advice.<\/p>\n

\u201cIn some cases, this inappropriate advice resulted in the client\u2019s self-managed superannuation fund being insufficiently diversified and exposed to risk of capital loss.\u201d<\/p>\n

In handing down judgment, Justice McEvoy<\/strong> said there was \u201c\u2026no evidence that the (Dixon Advisory) representatives conducted the necessary reasonable investigations into the recommended financial products or any alternative financial products, nor is there evidence that they considered the personal circumstances of the clients.<\/p>\n

\u201cThe contraventions were not the result of isolated or unauthorised conduct of the representatives. Six representatives committed the contraventions over a period spanning some three and a half years.\u201d<\/p>\n

The Court also ordered that if Dixon Advisory, currently in voluntary administration, resumes providing financial services, it must have in place appropriate systems, policies and procedures to ensure its representatives act in the best interests of clients. (See: ASIC Suspends AFS Licence of Dixon Advisory<\/a>).<\/p>\n

Dixon Advisory was also ordered to pay ASIC\u2019s legal costs of $800,000.<\/p>\n","protected":false},"excerpt":{"rendered":"

The Federal Court has imposed a $7.2 million penalty on Dixon Advisory and Superannuation Services after six representatives failed to act in their clients\u2019 best interests and failed to provide advice appropriate to their clients\u2019 circumstances. ASIC Deputy Chair Sarah Court says in a statement that licensees need to ensure their representatives are taking into […]<\/p>\n","protected":false},"author":24,"featured_media":62682,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[8,6,3],"tags":[],"class_list":["post-62678","post","type-post","status-publish","format-standard","has-post-thumbnail","category-compliance-regulation","category-dealer-groups","category-general"],"_links":{"self":[{"href":"https:\/\/riskinfo.com.au\/news\/wp-json\/wp\/v2\/posts\/62678","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/riskinfo.com.au\/news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/riskinfo.com.au\/news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/riskinfo.com.au\/news\/wp-json\/wp\/v2\/users\/24"}],"replies":[{"embeddable":true,"href":"https:\/\/riskinfo.com.au\/news\/wp-json\/wp\/v2\/comments?post=62678"}],"version-history":[{"count":0,"href":"https:\/\/riskinfo.com.au\/news\/wp-json\/wp\/v2\/posts\/62678\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/riskinfo.com.au\/news\/wp-json\/wp\/v2\/media\/62682"}],"wp:attachment":[{"href":"https:\/\/riskinfo.com.au\/news\/wp-json\/wp\/v2\/media?parent=62678"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/riskinfo.com.au\/news\/wp-json\/wp\/v2\/categories?post=62678"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/riskinfo.com.au\/news\/wp-json\/wp\/v2\/tags?post=62678"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}