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The corporate regulator has banned a Hunter Valley-based financial adviser for five years for not appropriately assessing whether limited recourse borrowing arrangements were suitable for his clients.
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Adviser banned for inappropriate SMSF advice
27 May 2020
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ASIC’s ban of Sean Philip Lewis followed a surveillance of his advice while he was an authorised representative of Spectrum Wealth Advisers from December 2013 to June 2018.
The regulator found that the NSW-based adviser advised most of his clients to use an LRBA to fund the purchase of real property through an SMSF, and also gave insurance advice to all clients.
When providing this advice, ASIC said Mr Lewis did not professionally and independently assess whether using an SMSF and borrowed funds to invest in property was an appropriate strategy for each of his clients.
The corporate regulator also noted that Mr Lewis did not adequately investigate or offer any alternative investment strategies that may have provided greater diversification of risks.
“Mr Lewis failed to comply with financial services laws, including by failing to provide advice that was in the best interests of his clients and failing to provide advice that was appropriate for his clients’ objectives,” ASIC said.
“When providing insurance advice, Mr Lewis prioritised his own interests over that of his clients. He provided insurance advice that would generate large commissions for himself, regardless of whether the recommended products were appropriate for his clients.”
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