ASIC has banned Mr Christopher Young, a life insurance financial adviser, from providing financial services for a period of five years.
Mr Young was an authorised representative of Affinia Financial Advisers Pty Ltd (Affinia) in the period 12 June 2013 to 23 July 2015.
ASIC commenced surveillance on Mr Young in mid-2015, which included a review of a number of his client files from the time he was an authorised representative of Affinia.
As a result of the surveillance, ASIC found that Mr Young had failed to act in his clients' best interests when providing advice and that he had failed to comply with several financial services laws.
In particular, it was found that Mr Young failed to:
- provide sufficient detail in Statements of Advice to enable his clients to make informed decisions about his advice;
- keep proper records; and in some instances, he had created false or misleading client file notes;
- make reasonable enquires into clients' relevant objectives, financial situation and needs;
- determine if the amounts of insurance cover he recommended were appropriate and if premiums were affordable and payment could be maintained by clients;
- conduct a reasonable investigation into financial products that might achieve the objectives of the clients;
- provide the required information about his remuneration and other relevant interests when providing financial product advice; and
- demonstrate the ability, professional skills and knowledge required to competently provide financial services.
ASIC Deputy Chairman Peter Kell said, 'Consumers should be confident that their financial adviser is acting in their best interests'.
'The business model of simply 'selling' life insurance without complying with the legal and regulatory obligations will not be tolerated by ASIC. Advisers who do so will be removed from the industry.'
ASIC's action was a response to information it received from the licensee, Affinia, regarding potential systemic concerns about advice provided by Mr Young in relation to insurance and superannuation products.
Following the identification of these concerns, and after Mr Young had ceased as a representative of Affinia in July 2015, Affinia reviewed all advice provided by Mr Young and implemented a remediation program for affected clients who had received advice from him.