ASIC has slapped a three-year ban on a financial advisor for his failure to comply with industry laws, including giving unsound advice that led to a loss of clients’ money.
Mr Alec Khoo, of Adelaide, was an authorised representative of Professional Investment Services Pty Ltd and provided financial advice to clients of his business known as Alec Khoo & Associates.
In a string of dodgy practices, among them a failure to produce statements of advice when asked, ASIC found Mr Khoo had also failed to have “a reasonable basis for advice that clients borrow funds through a margin lending facility, and invest a substantial portion of those funds in cash investments for up to three years,” it said in a statement.
His advice led to a “significant loss” to his clients’ investment portfolio as the interest paid outweighed the interest earned.
Furthermore, Mr Khoo failed to provide mandatory information on margin lending facilities, and in fact provided misleading information to a client, said ASIC.
It’s the second time today ASIC has cracked down on the financial advice sector.
Queensland-based Apple Investment Company Pty Ltd was banned for five years for its failure to comply with industry laws, among them misleading customers on a 24-month money-back guarantee.
ASIC also found that Apple breached referral selling provisions when it offered its ‘Apple Tree’, where clients could receive commissions from the trading of family or friends they had referred to Apple.
It was found that despite ASIC advice to Apple that the Apple Tree program was non-compliant, Apple failed to take all steps to cease promoting Apple Tree.