In March, ASIC announced it had banned Gerard McCormack of South Melbourne for five years for engaging in misleading and deceptive conduct.
Mr McCormack lodged an application with the tribunal in February seeking a review of ASIC’s decision.
In its judgement, released today, the AAT said while it found that Mr McCormack had breached the Corporations Act, a banning order should not have been made.
“That is because, in the very unusual circumstances of this case, I find that a banning order would not serve to protect the public,” the AAT said.
“Nor would it serve to deter like conduct because of the very remote possibility of the same or similar circumstances arising in the future. It would have no effect in maintaining investor and consumer confidence in financial markets which, on the evidence before me, was not in any event affected by Mr McCormack’s conduct.
“No person suffered any financial detriment and therefore no loss or damages claim could arise. Mr McCormack accepted that his conduct in attempting to recover his client’s money for him was wrongful and an aberration on his part. The only purpose a banning order could serve in these circumstances is to penalise Mr McCormack. That, by itself, is plainly an inappropriate purpose.”
Earlier this year, ASIC said an investigation found that between June 2013 and July 2013, while employed at NAB, Mr McCormack had phoned an industry super fund and falsely represented himself as a member of the fund in order to obtain information about the member.
He also witnessed his client phone and falsely say they were the same member in order to gain further personal account information, ASIC said at the time.
Further, Mr McCormack assisted his client complete and lodge false withdrawal forms, using the information previously obtained, so that all funds were transferred to his client, ASIC said.
Shortly after the announcement, NAB had welcomed ASIC’s decision.
NAB Wealth executive manager Greg Miller said Mr McCormack left NAB in September 2013 after concerns around his conduct were raised.
“Advisers must follow all processes and procedures at all times to make sure they are doing the right thing by our customers, but this wasn’t the case for Mr McCormack,” Mr Miller said.
“We want to strengthen our business and ensure we are always open, transparent and take issues impacting customers seriously.”
The withdrawal forms were false because the client wanted to access his own money? I’m confused but don’t care enough to look up the facts of the case. I do however agree with Nobby — NAB would not have just pushed him under a bus, they would have thrown him as well.
No one has any regard for the adviser, not the system, not the institution, no one cares about us, our mental health, our well being, what we as productive people contribute to society. We are singled out mercilessly because it is easy to do so.
cos it was the adviser that did the wrong thing?
Further to Nobb’s comment – you never see ASIC penalize the GM or Bank themselves, it’s always the adviser that is used as the scape goat.
They do penalise institutions – via undertakings because if they tried anything else the 1000’s of lawyers who are more equipped than those plebs employed by the ASIC would be destroyed – a thousand to date, it’s the small and independent advisers that they penalise most, without due regard for the competitive landscape. the whole system is rigged, the AFSL system created by the only ones who can possibly comply with and who when they err can get away with minor infractions. the rest of us are made examples of. this disgusting system created by the perpetrators favours them at the expense of independent practitioners and the customer. I am sick, disgusted, by this whole debacle. The weak “professional associations” who are weak and see nothing beyond the meagre member numbers they seek to muster up by defacing each other. the whole industry is disgraceful shame on us
NAB could care less. Advisers are just unpaid cannon fodder and fee generation cash cows..
As long as their own reputation isn’t tarnished, what would NAB care!
How come the only sensationalized stories appearing are those of advisers who have been banned or achieved misconduct? Never see any where ASIC or the banks praise all the great work advisers do for the community!