Filed by Piper Alderman, the claim has been brought forward by former Dixon Advisory client Trudy Stott and self-managed super fund Kosen-Rufu (which Ms Stott is director of the corporate trustee for) on allegations of conflicting advice.
It’s alleged that Dixon Advisory failed to act in the best interests of clients after its investment committee approved and recommended products to “be pushed on” to group members that Dixon Advisory stood to earn millions in fees from.
Piper Alderman has argued that the system conflicted with the interests of clients and said that claims for misleading and deceptive conduct have commenced.
“We are extremely proud to be acting for the applicant in this important class action, aimed at returning compensation to thousands of investors who have suffered significant losses on investments recommended to them by Dixon Advisory,” Piper Alderman partner Martin del Gallego said.
In a statement released on Thursday (4 November), EP1 said it intends to defend the class action but would not make any further comment, nor make any commentary on whether Mr Dixon will respond.
The news comes only weeks after Dixon Advisory was sued by Maurice Blackburn on behalf of a couple for poor retirement advice that left them $900,000 worse off.
“Our clients placed their trust in Dixon Advisory as their professional advisers to help them plan for retirement in a balanced and measured way, and instead Dixon Advisory exposed our clients to a level of non-diversified and highly leveraged risk which they did not want nor need and invested them in products in which Dixon Advisory had a financial interest,” Maurice Blackburn principal lawyer Craig Parrish told ifa last month.
“Our evidence suggests that had Dixon recommended that our clients invest their super in a balanced portfolio over the same period, our clients would have been almost $900k better off today.”
In July, Dixon Advisory paid a $7.2 million penalty for breaches of the Corporations Act and $1 million to go towards an ASIC investigation.
The quicker the Government bans vertical integration the better. Have seen ex Dixon clients who are not only in products that aren’t right for them risk wise, but are being charged fees of more than 2%, the investments have significantly underperformed, management (which is made up of Dixon execs) voted not to wind it up, and worst of all, the client can’t sell because Dixons now can’t recommend it to anyone else so there are no buyers.
It is great to see best interest held up.
As a one time client, I’d like to know what are the pros and cons of joining the class action against Dixon
This whole issue, and many other problems besides, could so easily be stamped out by banning vertical integration.
Idiot Hayne had the perfect opportunity to do so, but instead he chose to tie up all advisers in even more red tape, including the honest majority. What a dismal failure.