Wagga Wagga-based adviser Kimberly Holgate was an authorised representative of Commonwealth Financial Planning from January 2014 to October 2015, during which time ASIC found she had “engaged in conduct that was likely to mislead”.
Ms Holgate cut clients’ signatures from documents held on file and pasted these onto new documents, failed to act in clients’ best interests when rolling their super into new products issued by Colonial First State or when advising them to cancel existing insurance policies and apply for insurance issued by CommInsure.
Additionally, Ms Holgate failed to prioritise her clients’ best interests when advising clients to “acquire financial products which entitled her, her employer and its related entities to a financial benefit”.
ASIC said the super advice provided by Ms Holgate offered no improvement to clients’ financial position and that her insurance advice saw clients cancelling existing policies before new policies were approved, resulting in a lack of coverage and sometimes increased premiums and fees.
The underlying problem here is an incompatibility between working for a product sales company, and being a licensed adviser with a fiduciary (and now statutory) duty to act in clients’ best interests. It creates pressures and conflicts which are too difficult for most people to balance. No-one should seek the way out this planner did, but no-one should be put in that situation in the first place. Vertical integration between product and advice has to go.
we are all being banned by fasea anyway!
Yep.. i encouraged and pioneered this behaviour and got handsomely remunerated. I have now left the industry without any penalties and am running a very successful laundromat.
Pretty shitty and poorly informed comments
What about the clients ? And yes, what is management’s cut of fees for if it is not to manage ?
[quote=Anonymous]Whilst she should certainly be banned, ASIC should not put all the blame on her. The sell sell sell to the detriment of everyone culture and pressure to make targets at banks no matter what is the problem. Her managers and their managers should face the same penalty. They definitely knew what she was doing in regard to poor advice and changing insurances to CommInsure and no doubt rewarded her and were rewarded themselves for this behaviour.
It is disgusting that management get away without penalty as they are the reason this behaviour is rife in their institutions.[/quote]
Reality is the board of CBA should also have received a five year ban from being directors of any company. Shame, CBA, shame, shame, shame!!
[b]Banned?![/b] She should be charged with obtaining a financial benefit by deception and locked up.
As for the sales mantra, this is true but in life, we each have the ability to make our own choices, and she made hers.
Most financial planners would be banned if they delved into every file. You would lose every time on fees, kyc, best interest etc etc. Don’t think you wouldn’t, you would and you know it.
Speak for yourself.
That’s rubbish.
If you feel that way you should report yourself and take the ride. A 5 year ban might shut you up from speaking nonsense.
Are you ok? So sorry to hear you’ve been ripped by someone at some stage and you feel so angry. I’m guessing some PIS accountant who recommended an ag scheme in 2006 or you invested $5,000 in an AXA super fund for 20 years and it was $4,900 when you finally got around to looking at it. Perhaps you should get some serious psychiatric counseling so you can move on. Good luck Steven.
The real crooks got off scott free. At what point do you look at the people higher up the food chain and their boiler room sales pressures? If Financial Planners want to become a profession (to prevent over regulation) we must demand our professional associations stop getting money from product providers like the CBA, turn their attention to the real crooks and encourage the regulator to go after those truly responsible or at least the partners in crime.
For the FPA to just sit back and just smile as CBA management says it’s not us it planners and the solution is 1) planners to have degrees and 2) join the the FPA/AFA and meanwhile the CBA gets a get out gaol free card on the basis of compulsory membership makes the FPA/AFA a partner of crime also.
Really. We’re trying to absolve responsibility by blaming the faceless management again.
The job of a business manager, be it at CBA or a suburban IFA is to encourage people to make more revenue for the business. How individuals choose to react to that pressure is up to them. There are many options Kimberly Hogan could have taken before she chose to start falsifying documents.
As an aside, and in some kind of defence of their branch planners, many at CBA are so poorly trained that they really don’t understand the implications of some of their poor advice, and for that, the management does have to wear the responsibility.
Interesting that when the new FASEA obligations come into force there most probably will not be any more financial planners as no person will be able to afford to study and do another degree that is within the stated 5 year deadline as imposed by FASEA. This cost may be up to $ 20,000 odd thousand dollars and then one must do the planning subjects. ASIC may as well just start banning everyone from now to clean out the industry
Whilst she should certainly be banned, ASIC should not put all the blame on her. The sell sell sell to the detriment of everyone culture and pressure to make targets at banks no matter what is the problem. Her managers and their managers should face the same penalty. They definitely knew what she was doing in regard to poor advice and changing insurances to CommInsure and no doubt rewarded her and were rewarded themselves for this behaviour.
It is disgusting that management get away without penalty as they are the reason this behaviour is rife in their institutions.
Completely agree!!
What a great process improvement… we all should implement this in our own advice practices….
Am sure the process was signed off by their Risk Management and Compliance team..
Wondering why this even made headlines because everything she did is just another day at the office when it comes to CBA!
It very big news. It’s the first CBA adviser to be actually banned in a while. All the rest were forced to join the FPA and be forced to have their membership fees paid by the CBA.
Good riddance!
I see nothing has changed at Commonwealth Financial Planning!! Crazy how they get away with it.
I agree. When are the managers, and the managers managers also going to be held to account. There is such high presssure to sell, sell, sell. How many new clients have you seen? Why haven’t you made 3 paraplanning requests? Why haven’t you walked the floor to find new clients? Very high pressure when you’re in the middle of it. The FP managers must (do) know what’s happening. They need to be held accountable too.