ASIC said it had permanently banned former Guardian Advice insurance adviser Andrew Moroney from providing financial services. The regulator alleged Moroney "operated a business model of providing advice that prioritised his own interests ahead of his clients".
ASIC said Moroney's business model involved annually recommending his clients replace one insurance policy with another, meaning he received a high up-front commission payment for each replaced policy. According to ASIC, this meant clients who entered into a new life insurance policy annually were at risk of exclusionary periods and revised terms.
ASIC further alleged that Moroney:
- failed to make reasonable enquiries into the circumstances of the clients before providing advice to them to enter into a new life insurance policy;
- failed to conduct reasonable enquiries into insurance policies, both those already held by clients and alternative policies;
- incorrectly stated he had undertaken research on alternative life insurance policies, when this was not done;
- failed to demonstrate that the advice he provided to the clients was appropriate and in the best interests of the clients, based on their circumstances; and
- prioritised his own commercial interests ahead of the interests of the clients.
"Conduct by advisers aimed at maximising commission by replacing insurance policies, without valid reason, is unacceptable. It puts clients' coverage at risk and drives costs in the sector, which are ultimately borne by consumers. ASIC will remove advisers whose conduct breaches financial services laws and falls short of the standards expected of the industry," ASIC deputy chair Peter Kell said.
ASIC's recent wave of bannings has continued as the regulator has handed a permanent ban to a former insurance adviser.