ASIC has permanently banned a former Guardian Advice-aligned adviser after it was found he had prioritised his interests ahead of those of his clients.
Andrew Moroney was an authorised representative of Guardian Advice from March 2006 to April 2014. The regulator said Mr Moroney's business model involved annually recommending his clients replace one insurance policy with another.
This practice meant Mr Moroney received a high up-front commission payment each year for each replaced insurance policy, an ASIC statement said. Clients who entered into a new life insurance policy annually were put at risk of exclusionary periods or revised terms.
ASIC also determined that Mr Moroney failed to make "reasonable enquiries" into the clients' circumstances before advising them to switch policies. He also failed to conduct research into the insurance policies, the regulator said.
ASIC deputy chairman Peter Kell said: "Conduct by advisers aimed at maximising commission by replacing insurance policies, without valid reason, is unacceptable.
"It puts clients' coverage at risk and drives up costs in the sector, which are ultimately borne by consumers. ASIC will remove advisers whose conduct breaches financial services laws and falls short of the standards expected of the industry," he said.
Mr Moroney has the right to apply to the Administrative Appeals Tribunal for a review of ASIC's decision.
SUBSCRIBE TO THE IFA DAILY BULLETIN
- 20 Sep 2018Independent advice will prosper but must be paid for: LovedayBy James Mitchell
- 21 Sep 2018Former ASFA policy advisor to boost FPA ranksBy Reporter
- 21 Sep 2018Aligned advisers in search of freedomBy Adrian Flores
- 20 Sep 2018Banned Perth adviser did not engage in dishonest conductBy James Mitchell
- 20 Sep 2018‘No advisers have been mistreated’: DalyBy James Mitchell
- 20 Sep 2018Beacon advisers held ‘ransom’ while IIOF money remains missingBy James Mitchell
- view all