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Former adviser excluded from industry under ASIC EU

Former adviser excluded from industry under ASIC EU

Yes

The corporate regulator has accepted an enforceable undertaking from former adviser David Orth, director of boutique advice firm Real Wealth, which will see him cease to provide financial advice for a five-year period.

Mr Orth, who was registered to provide personal financial advice between March 2013 and November 2016, implemented a business model within his practice between May 2013 and December 2016 that provided advice to more than 750 clients, who were then offered a lost superannuation search, ASIC said in a statement.

According to the regulator, the representatives of Real Wealth conducting the lost super search would "make representations to them about the advantages of consolidating their existing superannuation funds into a single superannuation fund, and the returns on that fund" but did not consider the clients' needs.

"Real Wealth did not take into account the personal circumstances of clients or make reasonable inquiries regarding the clients' objectives, financial situation or needs," the statement said.

"Further, Real Wealth did not conduct a reasonable investigation into alternate financial products which might achieve and meet clients' objectives and needs most – instead often using a single fund that they had a relationship with, Hub24."

The company provided a 'general advice' warning, but didn't give SOAs for the products recommended, and charged clients 4.4 per cent of their total superannuation balance, ASIC said.

Under the enforcable undertaking, Mr Orth will not provide financial services on his own behalf or that of another person, be a director for a financial services business that owns, or is a corporate authorised representative of, an AFSL, apply for an AFSL, or hold out that he is an AFSL holder, for the next five years.

Mr Orth will also pay $400,000 to Financial Literacy Australia to "support the financial capability of vulnerable people", the regulator said.

Former adviser excluded from industry under ASIC EU
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