Dover owner and responsible manager Terry McMaster faced a grilling before the royal commission for an in-house policy, which counsel assisting Mark Costello described as “an elaborate attempt to exclude Dover’s liability for the acts of its authorised representatives”.
The policy makes clear that the licensee not be liable for anything a Dover adviser did which “is not within the authority” provided by the dealer group, which included failing to adequately research a product, consider clients’ personal circumstances, failing to adhere to the law, and more.
Terry McMaster responding to questions just prior to collapsing on the stand.
“The entire intention of this document is to minimise Dover’s liability for the work of its authorised representatives. That’s correct, isn’t it?” Mr Costello asked.
“As a sentence, that is correct,” Mr McMaster responded.
“Mr McMaster, I put it to you it is Orwellian to describe this as a client protection policy?”
“I agree with that. And this, of course, has been changed.”
Mr McMaster however debated Mr Costello’s point that this document was intended to protect Dover more so than its advisers’ clients and that complaints are to be “fought at all costs”.
Shortly before the scheduled end of proceedings, a source within the courtroom witnessed Mr McMaster physically collapse, prompting Commissioner Kenneth Hayne to call for paramedics.
Terry is smarter than the Chief Justice. Just ask Terry.
As a lawyer McMaster should have known better than to try and utilise the worthless and definitely misleading document to try and minimise any liability to Dover. Regardless of which AFSL through which an adviser is authorised – our nuts will always be on the chopping block if we give shonky advice (apologies for the crass comment ladies). But let’s put things into perspective here. I couldn’t see anything during the hearings or through reading the transcripts that indicated an Dover AR actually gave dodgy advice? Even Ms Orr’s summation yesterday did not reference any shonky advice that was attributable to a Dover adviser unlike advice given by advisers licensed through product manufacturers. Did I miss something?
My god, the comments on here are the perfect example as to why this RC is occurring! Seriously, you just watched the head of a licensee, whom himself was a practising lawyer, caught out deliberately drafting a legal document that has NO LEGAL STANDING. get that through your heads, the document was (in all likelihood) in direct contravention of the corps law, let alone basic contract law. Add to this, it was presented by advisers to clients in a way that was clearly misleading and deceptive. And yet here some of you sit defending that, despite clearly having no understanding of what you are defending. Clearly the Dunning-Kruger Effect should be compulsory learning for financial advisers!
Would it be possible that you go away and play “spot the AMP logo on your local AMP firms website”? Perhaps even pay 4 times your rates compared to your neighbour based on your neighbour having bulk purchasing power. Then come back. I’m certainly not condoning Dover’s behavior & it’s clearly illegal, it’s just that I think most might say that Dover mistake on their crummy marketing document, possibly not even seen by anyone it’s so crummy, [i]might just be an overkill.[/i] The guy had to be taken to hospital after 2 hours grilling. Compare this to thousands of AMP advisers that think there independent and actually give advice and you might not be so keen for residual advisers to study your freddie kugger effect.
It was not a marketing document, it was presented as a contract that all clients agree too. As for the rest of your post…. I have not idea what you are going on about or how it relates to my content, except to say that no where in my post did I claim that the army of aligned practices are ‘independent’. That’s clearly a straw man distraction.
Wrong BB. It was linked to the SOAs as a hyperlink and on the website. Upon the retraction none of my clients had any idea what it even was. Nice try to pretend you are informed though.
misleading and deceptive! let’s see what the counsel recommends the commissioner
the conduct of dover and henderson are alike so they should be treated with the same respect, i.e. recommend criminal charges
I was surprised the RC got stuck into Dover so aggressively. From what I hear, Dover is one of the better licensees. But maybe that was the RC’s point. By demonstrating that even good licensees have issues, it supports the argument that the whole system of large licensees is flawed, and that system should be scrapped in favour of individual licensing of every planner.
Would love an RC into any other profession, as there is no such thing as perfect! Let’s petition to have several started, namely:
* ASIC’ bungling and intentional misrepresentations to Gov & Parliament (surely equal to AMP’s misrepresentations. hence Jail for clowns Kell & Medcraft?)
* Politicians – eveything. Kick backs, allegiances to outside organisations and kick backs, the ‘old boys’ post employment (look at Gillard and several other highly prominent ex-pollies), broken promises and ‘best interests’ obligations for the nation as opposed to scoring points for an election
* RC participants – what exact objective did they say they were aiming to achieve versus what transpired and how they have conducted themsleves. Where is the scrutiny of the Me bank association and vertical integration of ISA funds?
After all you have read you think that Dover is still one of the better licensees? That is seriously stupid.
Hey I would think if a firm is going to have some type of insurance cover that protects the firm (not the client) then ultimately that is form of client protection in itself. i.e Dover could get multiple claims and just go into liquidation and that’s the end of it for everyone..including advisers. It’s marketing spin at the end of the day. Not something I would do myself but I’ve certainly see worse.
CRIMINAL CHARGES NOW!
Please. There isn’t going to be criminal charges.
As an AR of Dover, I am very impressed with the level of compliance required and the reviews of SoAs (it is second to none). I understand there’s lots of anti-Dover people in the market and that’s a shame. Although the planners mentioned in the RC have been poor, I appreciate Dover wanted to provide them with a “second chance”. Everyone deserves a second chance if they are willing to do the right thing and if Dover was willing to help this advisor better his approach to advice I believe this is a positive.
One comment: I am very pi$$y that an email was sent to my clients regarding the Client Information Policy and now the mess at the RC. Dover: I rely on the support from you so I don’t need to worry about these things, so that I can manage my business reputation. I will be considering my options regarding AFLS which will be very hard considering how great I think Dover is… Dover now needs to prove “why” I should stay and you should be doing a hell load of PR both within the industry and general press…
are you serious ? have you read what you have said, you think these people who deliberately took advantage of people while they were in a position of trust for personal benefit should be given a second chance
to dupe people again ? destroy lives. i think the majority in the community and your professional peers would disagree with your view.
I have nothing against Dover, they are average in my opinion, there are many worse and many that are far superior, recruit only the highest quality advisers and stay quiet and let their work speak for themselves
Dover have to review SoA’s because they have AR’s who are in general lowly qualified
if you only select a high quality adviser base you are not going to have as many issues
they should look at their recruitment tactics and be hard on the entry
but, i suspect they won’t be getting a lot now
True Anon – perhaps there is more to the story than what we all know. Agree with you that it should be a definite “no” if the advisor did in fact rip off the client…
Dova is da still da best deala gup for da gansta FPs and da mina lawyer bery good
As a fellow AR of Dover, you are a fool. Do you know how stupid you look?
he is mocking you, you dope. you are the fool for staying with dover.
criminal charges NOW !
SO mature.
care to think as to why there is lots of anti dover sentiment and why they are so poorly regarded ?
Because Terry is so self righteous and critical of others. If you are going to do that you better make sure your own house is 100% in order first.
Following my comments above and after hearing the Commissioner’s remarks: Dover should indeed provide further evidence to the RC due to yesterday’s misfortune. Secondly, I am quite appalled that Dover didn’t apply for leave to provide initial evidence to the RC. What is that about? I will be following this with great interest and I hope that ethics and morals are realised and they do the right thing…
“Client Protection” policy is no worse a misnomer that, say, Telstra’s “privacy’ policy…which is about how they will use your data – it’s a warning about the limit of your protection as well as the range of protections available under law. I only looked at Dover briefly (I have my own AFSL but wondered whether it was worth joining them if/when I ceased to do so) and they appear far better than most dealer groups in terms of ethics, guidance etc, so if I was an adviser with another dealer group I’d be careful about casting stones. You, too could find yourselves under fire when one or more of your colleagues is discovered to have gone rogue! Having your own AFSL and working alone at least protects you from all of that – but it can’t protect you from yourself. I try to do everything well but it’s not always easy, so my big policy is to not do what I’m not good at and to explain everything (down to the small details) about risks (what can go wrong) AND I get clients to agree they understand and accept the risks before proceeding with anything. I also don’t charge for them proceeding any more than if they don’t proceed. Advice should NOT be connected to the action. I also let them do their own transactions. Once advised well they can, so why wouldn’t they?
why don’t you join Dover and tell us about your experience so we also can think about not joining them.
Killian Plastow needs to do some proper homework before indulging in sensationalist headlines. It does not help the serious process. I, like any with long experience of the financial advice industry , am not at all surprised at the information about failings of supervision and systems by the big banks and insurers. I am surprised that some are surprised. However, there is a lot of ignorance being demonstrated in the questioning as well, and a bit too much witch hunt attitude by some players at times. Don’t assume it is all correct.
ASIC reviewed the DOVER Policy and it has been amended before the RC hearing.
and the document has been renamed.
Exactly so, anon and Jape. All Dover is doing is making it very clear what the law says. Having been Aurhorised by Dover before my retirement I can tell you that the conservatism, strict supervision and compliance management of Dover is such that every client IS protected unless the adviser deliberately or stupidly and illegally omits or bypasses that process and rules. If every licensee did their job properly like Dover under Terry McMaster we would not be needing this Royal Commission.
as an ex-dover AR how is the age pension or the newstart benefit looking. is it easy to survive on high school drop out + RG 146
A “Ben-Dover” moment.
Sounds like you have a lot of experience in this area, honey 😉
terry got hammered for a misleading and deceptive document
let’s see what the royal commission recommends
Asking one’s business associates to abide by the law is now considered evil !
I think that we need a royal commission into the Royal Commission.
you are past your use by date, when are you going to leave the game and retire to noosa and be drunk every day fool
Seriously anonymous? What a pathetic example of how low our industry has fallen if your inept, grammatically incorrect reply to PV’s message is any indication. Guessing you’re another Gen Y pretender wannabe who is jealous at an older guys success?
(b) is somewhat ridiculous. “I am acting outside of my authority, do you still wish to proceed?”.
I am happy to be corrected, however my understanding is Responsible Manager means Responsible Manager.
If you wish to own an AFSL, you need to accept the responsibility and liability for the advice and behaviour of the Authorised Representatives.
Not if someone is behaving illegally? Assuming if they’re doing so they wouldn’t be flaunting it, rather hiding it?
That is not the issue – the issue is who is responsible for the unlawful conduct. If your relatives were in a car accident because an Australia Post truck driver ran a stop sign, I will bet that you seek compensation from Australia Post for the misconduct of its employee driver – no?
correct. ultimately the AFSL is responsible for the conduct of it’s rep’s that is why they have a responsible manager. if the illegal conduct is deliberately dishonest by the AR then they will be punished accordingly and that will be reflected in the punishment, but the AFSL also shares in that liability
that’s the ticket to the game
these people don’t get basic logic. thank god for the RC scrutiny and higher education requirement all these people talking crap without knowing will be working elsewhere
Regardless of the name and/or intent of the document it can’t abrogate responsibility under the Corps Act so the point is mute.
It is not a moot point if the document is presented to people (including mum-and-dad clients) with an intent to deceive them about their legal rights when they have a complaint. When that happens the document presented to the clients is evidence of a criminal offence under section 12DB(1)(i) of the ASIC Act 2001. AnAnon – time for you to go back to school to learn more about the compliance framework of the industry.
FACTS.
the DOVER Client Protection Policy was reviewed by ASIC.
The DOVER Client Protection Policy has been renamed.
This all took place BEFORE THE hearing at the RC yesterday.
Really? Clearly put. So why didn’t the expert financial services lawyer Terry McMaster not respond to the RC in his compsny’s defence in the same way using the same words if those were indeed the “FACTS”? Just asking!
why are you responding to crap.
no one cares what ASIC’s review said.
everyone cares about what the Hon former justice of the high court of australia Kenneth Hayne thinks and he said the whole document was misleading and deceptive
that’s why terry fainted ( I wish him a speedy recovery)
D’over and Out !
Oh what a tangled web we weave! I’m not sure the advisers who joined Dover realized how exposed they would be, Dover seems to be intent on its own self-preservation rather than support its advisors, or protecting its clients.
that is true, so their mantra is basically that we will do all that is required to protect ourselves
and if:
a. we have to throw the adviser under the bus for minor breaches and report them to asic to make ourselves look good we will do that
b. if we have to fight the clients tooth and nail even if it means we insert clauses that could not be enforced and struck down we will do so
Dover advisers you should know what you are dealing with
they repeatedly paid for ads on this website spruiking how bad other dealer groups were
great business model
CORPORATIONS ACT 2001 – SECT 917D:
A financial services licensee is not responsible under section 917B or 917C for the conduct of their representative if:
(a) the conduct is not within authority in relation to the licensee (or in relation to any of the licensees, if there were more than one); and
(b) the representative disclosed that fact to the client before the client relied on the conduct; and
(c) the clarity and the prominence of the disclosure was such as a person would reasonably require for the purpose of deciding whether to acquire the relevant financial service.
Note: A person must not hold out that conduct, or proposed conduct, of the person is within authority in relation to a particular financial services licensee, unless that is the case. See section 911C.
Simple, logical points like this do not seem to be able to be heard.
And this leaves you with the question, what is it that we are actually accusing Dover of doing wrong?
Every client has been contacted with the updated policy, and letting them know that the previous policy won’t be relied on. This means, if they have a complaint they can make it. An absolute witch hunt of the highest order.
Dover checks every SOA, it may not spend much time with the lawyer, but that is actually the third step of the process. Most errors have already been found by the compliance team and the Vietman administration team.
These facts were not heard, mainly because Costello never gave Terry the chance to speak. The line of questioning was poor. This was supposed to be a RC into the banks and instead we have with hunted a guy over a policy that no longer exists and over giving a second chance to a couple of advisers, one of which I am not even sure got a fair hearing.
I fear for this industry and fear that the best possible option is simply to sell and run. All this is going to cause is more red tape and to make it harder to provide a good quality service to my clients.
sell and run AND this is going to cause more red tape is the only thing worth noting, the rest is all crap as in time – after reputations are irretrievably harmed – it will all be forgotten
“Forgotten”: do you really think so? After Storm came FOFA. It is the red tape of FOFA e.g. FDSs (ongoing service obligations) and best interests duty that has caused the largest number of adviser bannings since FSR started in 2001 and the virtual destruction of margin lending. Let’s see where the RC takes us, it is early days.
Dear Sir,
I refer you to the beginning of my post more specifically
a. sell and Run
once you do that, whatever else follows -BS, WTF, FFS, OMG, SMP, PPRC- is other people’s problem, precisely because one has [b]Sold and RUN [/b]
smp = so much paper work
PPRC = paper cut from so much smp
Quoting sections of the Corporations Act – section 917D: Oh! you must have forgotten about section 917E which states:
Responsibility extends to loss or damage suffered by client
The responsibility of a financial services licensee under this Division extends so as to [b]make the licensee liable to the client in respect of any loss or damage suffered by the client as a result of the representative’s conduct[/b].
That provision extends the liability of the licensee to conduct beyond the representative’s authorisations. But I guess you must have forgotten to read, that even though it is the next sub-section. I will bet that the consumer/plaintiff lawyers will not be that careless.
Nice try, both wrong, no prizes. Representatives (employees) and AR are quite different.
Good reply and good point Anon. Wonder if the ISA ever gets scrutinised (probably not in our lifetimes given the bias this clown crew displayed), whether they will have enough funds to handle all the misconduct and dodgy ‘retention at any sake’ advice their rep’s give!
You really are an idiot! Try reading section 910A. The definition of a “Representative” INCLUDES an authorised representative (see below in subsection (i)) OR an employee or director.
“representative” of a person means:
(a) if the person is a financial services licensee:
(i) an authorised representative of the licensee; or
(ii) an employee or director of the licensee; or
(iii) an employee or director of a related body corporate of the licensee; or
(iv) any other person acting on behalf of the licensee;
Glad they are upping the education levels for being adviser – we will not have to hear from you after 2024.
what is Dover accused of ? Oh I don’t know.
why don’t you ask counsel assisting the royal commission and commissioner Hon Kenneth Haynes, former justice of the high court of Australia
they seem to think the whole of the document was misleading and deceptive
of course, you and Dover (clearly) know better than the former justice of the supreme court of Australia who willy nilly makes baseless allegations on national television for all to see
are you stupid ?
No but you are.