Australia Bans Former Advisor For Failing To Act In Clients' Best Interests

Josh O'Neill

16 October 2017

Australia’s securities watchdog has banned a former financial advisor from the industry for three years after discovering he allegedly advised clients on investments that were not in their best interests.

Drew Grosskreutz allegedly advised clients to set up self-managed superannuation funds (SMSF) to purchase properties using a limited recourse borrowing arrangement “without considering if this was in their best interest,” the said in a statement.

“The decision to establish an SMSF is one of the most significant steps a consumer can take in relation to their retirement savings,” said ASIC deputy chairman Peter Kell. “It is therefore essential that before making the decision to set up an SMSF, consumers have access to good quality, tailored advice that is not conflicted.”

ASIC said that Grosskreutz failed to properly identify what his clients wanted advice on; make reasonable enquiries into the clients’ relevant objectives; give priority to his clients’ interests; and understand what was required of him to comply with fiduciary duties.