In a letter to the Real Estate Institute, ASIC warned that some real estate agents were advising tenants to apply for early release of their super in order to pay rent – something that could breach the Corporations Act.
“Financial advice must only be provided by qualified and licensed financial advisers, or financial counsellors, not by real estate agents who neither hold the requisite licence, nor are an authorised representative of an Australian Financial Services Licensee,” ASIC wrote.
“The Corporations Act imposes significant penalties for a contravention of section 911A. For individuals this can be a maximum of five years imprisonment, and/or a fine of up to $126,000 (600 penalty units), and for corporations a fine of up to $1.260 million (6,000 penalty units).”
ASIC wrote that tenants facing financial difficulty need “sound financial guidance and potentially debt counselling” – and warned that it would come down hard on any real estate agents it found breaching the act.
“We will be raising these concerns with the relevant state regulatory bodies and will be writing directly to firms where it is alleged or brought to our attention that they have breached the law,” ASIC wrote.
“ASIC intends to monitor this situation closely, and if contraventions of the licensing requirements of the Corporations Act are found, ASIC will not hesitate to act swiftly to protect vulnerable consumers.”
ASIC suggested that real estate agents instead direct tenants to their MoneySmart website if they felt they were in need of help with their financial affairs.
I wonder if ASIC is even AWARE that their legislation and their regulation has caused an unequal, precipitous playing field … when Australian’s need advice more than ever they can’t even FIND IT thus spawning an ‘advice black market’. Hello Danielle and Louise ? Soft hands Dante … I’m not sure the industry is advancing which you’ve self admitted is your brief.
all this demonstrates is how much people are really needing an adviser at the moment but because most have been shut down, in the process of changing licencees, focusing on their studies, or trying to meet all of the compliance requirements needed to produce advice people are getting free opinions from unauthorised no bodies. Great result ASIC really in public best interest.
what about the accountants? What a pathetic press release by ASIC.
Codswallap. ASIC intends to do what?? Doctors tell their fat clients to access funds from super for weight loss surgery. They have the system down pat. Funeral directors tell Widows to access funds from their own super funds to pay for husbands funeral costs. IVF clinics tell childless women to access funds from Super for the IVF costs. What does it take to get ASIC fired up? Don’t get me started on unlicenced solicitors who give Super fund advice and brag about “getting more”‘ with them. How can a TPD claim in super get more than the sum insured plus account balance??
ASIC desperate to be seen to be doing something so that the big 4 and AMP can continue with business as usual
So ASIC has never once done this to unlicensed Real Estate Agents, Accountants, property spruikers, particularity in the SMSF space, whilst Advisers have been shouting from the roof tops about this (unlicensed advice) for years. Now suddenly they do this? This is just absurd that they haven’t taken any action previously.
If I give specific property advice, I get drawn and quartered. Agents get a warning. Why not litigate ASIC? Gutless.
And yet the ABC today is telling people to deposit $10,000 into Super, claim the tax deduction and withdraw $10,000 tax free. How is THAT not advice? Hello?? ASIC????
Good job. Should warn them about property purchase advice too.
Sorry – takes too long to prepare the advice docs and clients can’t pay for my time and I also have a family to feed. So my existing clients will have priority…You make your bed…you lie in it…
Well hello! A real estate agent finally held accountable! There’s a newy!
Funny, ASIC sent a harshly worded letter and they pat themselves on the back thinking they fixed the issue. Typical lazy ineffective pen pushers who have absolutely no idea. People have been getting unlicensed advice from accountants, lawyers, real estate agents, car salesmen etc for years and ASIC has just sat back and done nothing. Or perhaps these people are just giving general advice just like their union fund buddies?
What’s a “warning shot” ASIC ??.
A growl ?
Where are your balls and where is the vindictive, biased and relentless approach you exhibit toward financial advisers?
So, ASIC suggested real estate agents to direct them to their own website, rather than them suggesting they contact a licensed financial adviser ?
I suggest that ASIC wont prosecute one real estate agent at all.
You could probably spend a bit more time in the industry and find a few other gremlins.
The cost of this advice is circa $4,400 GST incl.
After ASIC’s sooooooooooooo over complicated BS Red Tape fiasco that Financial Advice has become.
Advice for $10K from Super x 2 = $20K withdrawal, less $4,400 Adviser fees = $15,600 to struggling renter.
Great job ASIC !!!!!!!!!!!
ASIC you should try to find some real world logic in your bureaucratic BS Red Tape madness you have created.