The former client of a collapsed licensee has reached out to the Financial Ombudsman Service in an effort to recover the $70,000 he says was stolen from him under ASIC’s watch.
According to his submission to FOS, Greg Wenmoth and his wife lost a large portion of their nest egg after they invested into a dodgy venture ran by Protect Ensure – a now-defunct Sydney advice firm that had allegedly been on ASIC’s radar since 2012 following reported concerns.
Mr Wenmoth said he and his wife had been offered a return of 6.2 per cent per annum for making the investment. What he did not know, however, was that the firm’s director, Lee Robin, had been using the money to pay other noteholders and fund personal expenses.
ASIC eventually cancelled Protect Ensure’s licence in December 2014, but only for not having adequate financial resources, a media release states. Mr Lee’s misconduct was not mentioned until December 2015, when ASIC announced his permanent ban from the industry.
However, by then it was too late. The business had been sold several months earlier in May 2015 for only $210,000 and a “friendly” liquidator was appointed. Most clients would never see their money again.
Mr Wenmoth blames ASIC for not taking action sooner.
“We believe there are a lot of things that were not investigated correctly and that were simply just swept under the carpet,” he said.
“It is unclear what measures, if any, were taken by the regulator to protect the public in relation to the sale of Protect Ensure’s assets. Why was a ‘friendly’ company allowed to be appointed as a liquidator and why did ASIC not seek a court-appointed liquidator to ensure the matters were dealt with correctly and fairly?
“I do not believe that this would have ever happened had ASIC shut Mr Lee Robin down when it was first discovered that he was behaving in a dishonest manner.”
This story is part of a widespread investigative feature on ASIC enforcement activity to be published in the March edition of ifa magazine.
SUBSCRIBE TO THE IFA DAILY BULLETIN
- 11 Dec 2018ASIC cancels AFSL of Queensland groupBy Eliot Hastie
- 11 Dec 2018Liberal Party has done ‘almost nothing’ for advisersBy James Mitchell
- 11 Dec 2018Better advice complaints resolution needed, says ASICBy Adrian Flores
- 11 Dec 2018Wealth management holders unlikely to seek adviceBy Sarah Simpkins
- 10 Dec 2018Only 12% of advice practices have exit plansBy Adrian Flores
- 10 Dec 2018CIPRs need to account for future mortality rates, study findsBy Adrian Flores
- view all