In a statement, ASIC alleged that RI Advice Group failed to take reasonable steps to ensure that former financial adviser John Doyle provided appropriate advice, acted in clients’ best interests and put his clients’ interests ahead of his own, as required by law.
Mr Doyle was an authorised representative of RI Advice between May 2013 and June 2016. RI Advice was, until its recent acquisition by IOOF, an ANZ-aligned firm.
ASIC also said it is taking action against Mr Doyle, alleging that he gave inappropriate “cookie cutter” advice to retail clients to invest in complex structured financial products called Macquarie Flexi 100 Trust and Instreet Masti 36 and 38, without taking into account their financial goals or risk tolerance.
The impacted clients were, in some cases, preparing for retirement, ASIC said. Further, it alleged that Mr Doyle received upfront and ongoing commissions for each of his clients’ investments in the structured products.
In addition, ASIC alleges RI Advice knew, or should have known, that there was substantial risk Mr Doyle was not complying with his obligations under the law and was repeatedly recommending structured products to his clients, bypassing compliance processes. ASIC also alleges RI Advice did not take reasonable steps in response.
Finally, ASIC also claimed that RI Advice contravened general obligations as an Australian Financial Services Licence holder and is seeking compliance orders from the Federal Court to prevent similar contraventions occurring in the future.
The maximum civil penalty for contraventions alleged against RI Advice is $1 million per contravention. For Mr Doyle, the maximum civil penalty is $200,000 per contravention.
The conduct of both RI Advice and Mr Doyle was examined as a case study on ‘bad advice’ as part of the interim report of the Hayne royal commission.
What are you talking about
I wouldn’t get too complacent. One suspects this will be the start of many actions during 2020. Remember Peter Kell’s evidence in the RC about 90 percent of SMSF advice being not suitable ? I think the sample was about 170 adviser files. By my maths, about 146 people should be a bit nervous. On a completely unrelated front. Some of the bigger (and smaller) AFSL’s who charge advisers a servivce fee would be getting a bit sweaty. I would be asking WTF – did my fees pay for ? YOU were supposed to looking after my compliance – and I’m not. YOU were the ones providing PD etc? Why didn’t YOU make me aware of the significance of an ASF post FOFA ?
Senior RI staff;
Darren Whereat (2013 to 2016)
Graeme Hyland (left in 2015). Updated LinkedIn profile now excludes time at RI
Peter Ornsby 2004 to present
Danielle Nugent 2015 to present
The fish rots from the head…
Will senior management retain their position after being exposed for fostering a culture of turning a blind eye while having their snout in the trough and pocketing hefty bonuses?
What about AMP and the banks?…ad nauseam. Oh that’s right….all have fancy lawyers and QC’s to defend.
What about the IOOF adviser mentioned in the RC or is that to hard. ASIC have all the information.
Ah John Doyle. The behaviour discussed here is between 2013 and 2016. I had the mispleasure of encountering his methodology and less than ethical antics before 2013. He was a with another licensee, Australian Financial Services (which were shut down due to dodgy behaviour). His licensee ignored his lies and non-compliance, and it took a complaint to the Ombudsman to get any traction.
Yeah they all moved to RI advice from AFS (Pistol Pete) because of the Platform sign on money they were paid
All AFS advice was Russell and Strategy Platform – the old Peter Daly Special that one
This one will need Popcorn as it plays out !
And it goes without saying that the management at ANZ will also be held to account for this………mmmm maybe that’s a bridge too far.
John Doyle’s behaviour and track record was well known prior to ANZ signing him on. His previous licensee (a small licensee of which he played a large role in, can’t recall exactly what his role was though) was shut down due to unethical behaviour. So RI just snapped him up, despite there already being ASIC imposed undertakings on him. Keep in mind for every complaint and audited file between 2013 to 2016, there would be hundreds more examples of similar behaviour prior to 2013 and during his long career.