Financial adviser cast out after nearly $300K theft

By Lucy Dean

January 12 2018
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A financial adviser who transferred nearly $300,000 out of a deceased estate’s bank account into his own, and that of his company, is the latest to be permanently banned.

Financial adviser cast out after nearly $300k theft

The South Australian man, Robert Pryor Smith has been permanently banned from providing financial services, the Australian Securities & Investments Commission (ASIC) reported on Friday.

Banned because he is “not of good fame or character”, ASIC revealed that Mr Smith had transferred $278,042.58 out of the bank account of a deceased estate for which he was the trustee and executor and into bank accounts held in his own name, or held in Advice4Wealth’s name.

“ASIC found that Mr Smith's conduct was designed to benefit his own interest and financial needs at the expense of the estate and the beneficiaries.

“ASIC also found that Mr Smith's conduct was dishonest and that he made false statements about what happened to the estate funds.”

Clients who believe they may have been the victim of dodgy advisers or have had their advisers banned were told by ASIC that they should consider asking for a review of the advice they have received.

When reviewing the advice received individually, ASIC said clients should consider whether the advice aligns with four key areas:

1. Situation, needs and objectives.

Does the advice you have received come with an accurate description of your income and expenses, liabilities, assets, goals and risk profile?

2. Strategy and scope

Has the adviser explained any advantages or disadvantages associated with different strategies and projections?

3. Products selected

ASIC said clients should consider how well products recommended by a financial adviser fit within the client’s overall strategy.

4. Investment balances

Clients should check that the initial investment aligns with the investment funds and that fees, contributions and investment returns are in line with expectations.

“If your adviser has been banned from providing financial advice you should read ASIC's media release about the banning to find out why the adviser has been banned. This may help you work out whether the advice you received was appropriate,” the commission added.

ASIC added that bans may be for specific areas of practice such as advice and as such banned parties who specialise in multiple areas may still be eligible to provide services in their other capacities, like as a mortgage broker or tax agent.

However: “You will need to decide whether to continue using your adviser for other financial services.”

If your adviser has been banned from providing advice they are no longer allowed to provide you with financial advice, ASIC added. The commission advised clients that if a banned adviser contacts you to provide financial advice, you should make a complaint to ASIC and ask the adviser to stop calling you.

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