An SMSF company has been hit with a $10,200 penalty after purporting to use ‘ASIC approved’ financial products when in fact it did not.
Property Capital – also known as SMSF
Property Advisers – paid the hefty fine after ASIC issued them an infringement notice for making the potentially misleading statements on its website.
ASIC deputy chairman Peter Kell said this should be a warning to anyone advertising financial products.
“It is crucial that consumers are not misled about the level of risk associated with any investment. ASIC takes the misuse of language such as ‘ASIC endorsed’ or ‘ASIC approved’ very seriously, especially in the area of SMSF
s,” he said.
“Creating a false impression of the level of regulatory approval for investments can lead to consumers making poor decisions. Providing accurate information that does not mislead is fundamental to the operation of a fair and efficient market.”
The company – which is an authorised representative of Guardian Securities – removed the statements from its website once approached by ASIC, Kell said.
ASIC has the discretion to issue an infringement notice as an alternative to taking civil penalty action.
However, ASIC says the payment of the infringement notice penalty is not taken as an admission of liability or a contravention of the consumer protection provisions of the ASIC Act.
Property Capital had made the following claims on its website:
- “SMSF Property Advisers has a pipeline of managed property investments through Australian Securities and Investments Commission approved schemes.”
- “By partnering with many other SMSF investors in an ASIC approved managed find our clients receive the significant benefits of a development project achieved without carrying any bank debt.”
- “Using an Australian Securities and Investments Commission (ASIC) approved structure, we give our clients access to developer profit margins, relatively short turn-around investment returns, and developments without debt.”