ASIC has banned Tanawha-based adviser Douglas Cecil Allen from providing financial services for three years.
ASIC's review of a sample of Mr Allen's advice files identied that Mr Allen was using a 'layered advice' strategy and ASIC found that he provided advice that was not in the clients best interests, was not appropriate and that he made false or misleading statements.
It was found that, when providing advice to clients, Mr Allen failed to:
- make reasonable enquiries to obtain complete and accurate information when certain aspects of a client's situation were incomplete or inaccurate;
- reasonably consider a client's insurance options when recommending a client consolidate their superannuation. Mr Allen did not provide a reasonable assessment of the client's existing insurance, or consider whether there would be insurance consequences for rolling over the client's superannuation which may have resulted in them being uninsured for a period; and
- appropriately scope the superannuation advice to include insurance. Such a limited scope resulted in an insufficient assessment of whether the benefits achieved from rolling over a client's superannuation would outweigh the disadvantages from the loss of the insurance.
Mr Allen's statement of advice documents provided to clients also contained product comparison tables that were false or misleading. In comparing the client's superannuation products, Mr Allen understated the potential insurance costs despite knowing the insurance premiums would likely be higher once insurance advice was provided.
The banning order took effect from 15 March 2022.
The banning has been recorded on ASIC's publicly available Financial Advisers Register and the Banned and Disqualified register. ASIC's MoneySmart website has useful information for consumers whose advisers have been banned.
Mr Allen sought a review of ASIC's decision by the Administrative Appeals Tribunal on 6 April 2022. The application for review was withdrawn on 6 February 2023.
Background
Mr Allen was the sole director and secretary of Global Pacific Solutions Group Pty Ltd (Global Pacific) (AFS licence no. 514164) since 22 January 2019. Mr Allen was also Global Pacific's responsible manager, operations manager, compliance manger, complaints manager and training officer.
Prior to his involvement in Global Pacific, Mr Allen was a representative of Smart Solutions Group (Aust) Pty Ltd (Smart Solutions) (AFS licence no. 500218).
The director and responsible manager of Smart Solutions, Tim Shapter, was banned, and the AFS licence cancelled, by ASIC in February 2020 [20-020 MR].
