Australian financial advisory firm slapped with $11m fine
A financial advisory firm, which offered self-managed super fund services and has since collapsed into liquidation, has been hit with $11m in fines after legal action by the corporate watchdog.
Business
Don't miss out on the headlines from Business. Followed categories will be added to My News.
A collapsed financial advisory firm, which offered self-managed super fund services, has been slapped with more than $11m in fines after legal action by the corporate watchdog.
NSW-based DOD Bookkeeping, which is now in liquidation and was previously called Equiti Financial Services (FS), was handed $11.03m in penalties after the Federal Court found it breached conflicted remuneration rules and its advisers provided inappropriate “cookie cutter” advice.
A statement from ASIC said Equiti FS was part of a group of companies called the Equiti Group, and offered self-managed superannuation fund establishment and administration services.
The group’s other arms, Equiti Property and Equiti Finance gave access to real estate and mortgage broking services.
Equity FS paid $130,250 in bonuses to three financial advisers who provided template advice to clients to roll over their super into self-managed super funds and use those funds to buy property through their related entity, Equiti Property.
The court found these bonuses ultimately influenced the advice they provided and breached conflicted remuneration laws.
In the case of 12 clients who gave evidence in court, the advice provided was “cookie cutter” and failed to take into account each client’s individual circumstances or objectives, ASIC said.
Justice Goodman said that “little or no heed was paid to the particular circumstances of the clients”.
In handing down his Judgement, he said clients were not given sufficient time to understand the advice given to them that was focused on “manoeuvring the clients into property purchases through self-managed super funds”.
“The contravening conduct was plainly deliberate and extended over a period of several years,” he said.
The Australian Securities and Investments Commission cancelled Equiti FS’s Australian financial services licence in November 2024.
ASIC deputy chair Sarah Court said misconduct exploiting superannuation savings was an enforcement priority.
“In this case the court found bonuses paid to advisors influenced the advice they provided, resulting in poor financial outcomes for the consumers involved,” she said.
“Financial services licensees who employ advisers to provide personal financial advice need to ensure that they place their clients at the forefront.
“The size of today’s penalty demonstrates the seriousness of this misconduct.”
More Coverage
Originally published as Australian financial advisory firm slapped with $11m fine
Albo’s minerals stockpile won’t fix tariffs – but will give us ‘leverage’
The PM says a strategic reserve of minerals like cobalt, lithium and nickel would give Australia “leverage” with Donald Trump – but experts say his plan needs to go much further.
They thought it was their dream home. They ended up in ankle-deep water
A group of Ringwood residents remain locked in a vicious battle with their developer over claims of critical defects in their apartments which have left some owners selling at a $150,000 loss and others wading through ankle-deep water.