ASIC has imposed a three-year disqualification on Douglas Cecil Allen, an adviser based in Tanawha, following an examination of his advice records that exposed his utilization of a strategy known as "layered advice."
Based on a statement issued by the Australian Securities and Investments Commission (ASIC) on Wednesday, the inquiry also revealed that Mr. Allen provided advice that was unsuitable for the best interests of his clients while making false or deceptive statements, which ultimately resulted in the imposition of the ban.
Furthermore, it was discovered that when delivering advice to clients, Mr. Allen failed to:
- Adequately gather comprehensive and accurate information in cases where certain aspects of a client's circumstances were either incomplete or inaccurate.
- Properly consider a client's insurance choices when recommending the consolidation of their superannuation. Mr. Allen did not provide an appropriate evaluation of the client's existing insurance nor contemplate the potential insurance ramifications associated with rolling over their superannuation, which could have left them uninsured for a certain period.
- Sufficiently encompass insurance in the scope of the superannuation advice. This limited scope resulted in an inadequate assessment of whether the advantages gained from transferring a client's superannuation would outweigh any disadvantages stemming from the loss of insurance coverage.
Furthermore, ASIC determined that Mr. Allen's statement of advice documents, furnished to clients, contained product comparison tables that were deceitful or dishonest. Upon comparing the superannuation products of clients, Mr. Allen understated the potential insurance expenses, despite being aware that insurance premiums would likely rise following insurance advice, as noted by the regulatory body.
The prohibition order became effective on March 15, 2022.