Westpac admitted on Thursday that advice tendered to registered nurse Jacqueline McDowall and her husband to set up an SMSF and sell the family home in order to finance a bed and breakfast was “poor advice by default” and “not in the McDowalls’ best interests”.

Nevertheless, the adviser in question, Krish Mahadevan remains employed by the major bank as a portfolio adviser.

Under his advice, the royal commission heard, the McDowalls sold their home and transferred their combined superannuation balance of $200,000 into an SMSF.

The life, TPD and income protection insurance they took out on the advice of Mr Mahadevan netted the adviser $16,000 in upfront commissions, while costing the McDowalls $27,000 a year.

This was on the assurance that the couple could borrow “up to $2 million” to finance their retirement dream – a B&B.

However, the McDowalls ultimately found they were unable to borrow more than $200,000.

The couple has since moved to the Northern Territory to seek better-paying work. Ms McDowall told the commission that prior to selling the family home she was planning to retire at around 60.

However, she now believes she will retire only when she can’t walk.

“Probably when I’m in a wheelchair or Zimmer frame. Looks like I will be working till I’m 80.”

Visibly tearful, Ms McDowall explained that she had been unable to tell her children until the royal commission asked her to give evidence as she was too embarrassed and felt “humiliated, stupid”.

“I’ve decided to tell my story because I wouldn’t wish this to happen to anyone again. I want it to get out there that when the banks, Westpac or other, train these people up to be professional advisers, that they tell the truth, and they don’t skimmy by things and make you feel that anything’s possible, and then all of a sudden, they pull the rug from under your feet after they have gained all that money from you and transferred everything in your trust, because, at the moment, I don’t know if we’re ever going to be able to get into our own home again,” she said.

Telling the Commission that she will “never, ever trust anybody again”, Ms McDowall said the “horrible situation” Westpac put her and her husband through has left her “utterly” disgusted.

“I hope no one ever has to go through it again.”

The couple has since accepted a settlement with Westpac of just over $100,000 after two compensation offers.

Responding to the McDowall’s story, the general manager of Westpac-owned BT Financial Advice Michael Wright agreed the advice was “unviable” and “bad”.

He agreed that it highlighted the way Westpac’s adviser complaint system was flawed, in that demerit points received by advisers are wiped clean every six months.

“That is a design flaw that we will be changing,” Mr Wright said, agreeing that it was a “failing” in terms of advice supervision.