A major financial advice group has paid more than $21,000 in penalties for claiming it was ‘independent’ and ‘non-aligned’ on its website.
ASIC said in a statement that Findex Group Limited and Financial Index Australia (FIA) have each paid a $10,800 penalty after receiving infringement notices for potentially misleading claims.
The Findex group of companies – which includes Findex Group Limited and FIA – promotes itself as “one of Australia’s largest financial advisory businesses”.
Between August 2015 and December 2015, the company claimed on its website that its services were ‘independent’ and/or ‘non-aligned’, the statement said.
ASIC said it became concerned that these words may have led consumers to believe the services being offered were free of any conflicts of interest.
The services being offered, however, were likely to have been affected by commissions or other benefits received from the issuer of recommended financial products. There were also conflicts of interest arising out of the Findex’s associations or relationships with issuers of financial products, the statement said.
“ASIC considered that the inaccurate representations of independence by the Findex Group may have prevented consumers from correctly assessing the quality of the services on offer,” ASIC said.
“An infringement notice was issued to Findex Group Limited for making the statements on behalf of the Findex Group. A separate infringement notice was issued to FIA as the registered owner of the Findex website.”
Findex Group Limited and FIA have since responded to ASIC’s concerns by removing the statements from the website by December 2015.
ASIC deputy chair Peter Kell said, “The accurate promotion of financial services, particularly around the issue of independence, is critical in order for consumers to make confident and informed financial decisions.”
“This action puts the financial services sector on notice that ASIC is serious about tackling the inappropriate use of the term ‘independent’.”
The payment of an infringement notice is not an admission of a contravention of the ASIC Act consumer protection provisions. ASIC can issue an infringement notice where it has reasonable grounds to believe a person has contravened certain consumer protection laws.
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