A financial planner has been slammed for his role in filing allegedly fraudulent loan applications that led ASIC to ban a mortgage broker this week.
Banned Sydney broker Athol Halvorsen told Wealth Professional sister title Australian Broker Online that he has been made a “scapegoat.”
The watchdog handed Halvorsen a six-year ban on Tuesday, and cancelled the credit licence of Gearing.com, where Halvorsen is a senior manager.
ASIC claimed he submitted nine loan applications to St George and Perpetual, pre-GFC, that contained false and misleading statements regarding the borrowers’ income and employment.
However, Halvorsen strenuously denies the fraud allegations, saying that the borrowers themselves signed the documents to say all information provided “was correct and true”, that the information was provided by the clients in conjunction with their financial planner – and that the banks accepted it.
“These clients received an electronic copy of the application forms, from St George as part of their mortgage documents and they have to read it and sign it to authorise that everything in the application form is true,” he said.
“Clearly they’ve just exaggerated things, for example ‘my car is worth $19k’ when the application form says it’s worth $29k. That’s what it boils down to. You have to sign it and send it back to get your money advance. They’ve all agreed that whatever was on that application is true and correct.
“That’s information provided to me from them and their financial planner.”
The financial planner involved, who Halvorsen did not name, was banned earlier this year for his role in the saga.
A matter of trust
“I was not investing money for clients into an investment scheme. I had nothing to do with it. I had no idea. They came to me from their financial planner,” he said.
“When I’m with a client and also liaising with their financial planner – at their request – I trust, and they trust, the financial planner. Had their money not been lost, there’d be no problems whatsoever.
“I wasn’t acting for them [as a financial adviser]. I was doing my job as a mortgage broker.”
He admitted the loans were low documentation for a property investment, although he had “no idea” what the investment scheme was, and it wasn’t his responsibility to know.
“As I said their financial planner lost their money, so now these poor clients, and I do feel for them, are just trying to get their money back.
“They’ve tried St George, they’ve tried personally coming after me, they’ve tried this and that, and the last resort was ASIC.”
Halvorsen added that the banned planner involved in the alleged fraud “has been screwed”.
“He was first target of course. But he didn’t get the clients out of debt, and that’s what they’ve been trying to do. Which I do understand – they’re trying to get out of a debt. And that’s fine. But personally I was not involved in what they were investing in. I don’t actually know what they were investing in. At the time I didn’t – of course I do now.”
He said ASIC bans of this nature will only increase in the near future, and the lenders should be held accountable for their role.
“ASIC will crack down. It will blow up in the banks’ face eventually, but I don’t think [mortgage brokers], the number one scapegoat here, will get any benefit from that.”