The Australian Securities and Investments Commission (ASIC) has banned a Victorian financial adviser for providing conflicted personal advice to clients, particularly those advised to establish SMSFs and invest in highly speculative investments linked to his financial services business.
ASIC has banned Joel James Hewish from offering financial services for 10 years and cancelled the Australian financial services licence of his business, United Global Capital Pty Ltd (UGC).
Specifically, the corporate watchdog found authorised representatives of UGC contacted clients and recommended they establish SMSFs to roll over their existing superannuation funds and invest in Global Capital Property Fund Limited, in which Hewish had an interest.
ASIC alleged UGC representatives obtained phone numbers from a third-party website operator and offered a superannuation health check before encouraging clients to establish an SMSF and invest. It also alleged UGC advisers told clients they were not receiving personal financial product advice.
UGC also attempted to circumvent its personal advice obligations, despite its representatives providing personal advice to clients, thus breaching those obligations. This included failing to act in clients’ best interests and giving inappropriate advice.
ASIC stated UGC violated several of its general obligations as a licensee. These included the obligations to provide financial services efficiently, honestly and fairly, take reasonable steps to ensure its representatives complied with financial services laws and have adequate arrangements to manage conflicts of interest.
The regulator banned Hewish because he was involved in UGC’s conduct as its responsible manager and key person under the licence.
It alleged he demonstrated a fundamental lack of competence, showed a cavalier attitude towards his management of UGC and complying with financial services laws, created a culture of non-compliance and incompetence at the firm and cannot be trusted to comply with financial services laws.
Hewish and UGC have appealed to the Administrative Appeals Tribunal for a review of ASIC’s decision. His banning is now recorded on ASIC’s Banned and Disqualified Register.
ASIC stated investigations will continue into UGC’s conduct and it advised impacted clients to consider lodging a complaint with the Australian Financial Complaints Authority if they are concerned about advice provided to them by the firm.
