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ASIC imposes 6 year ban on financial adviser

In October 2019, the Australian Securities and Investments Commission (ASIC) imposed a 6 year ban on financial adviser, Jihad (or Joey) Soleiman, preventing Mr Soleiman from providing financial services during the period of the ban. The ban follows ASIC's finding that Mr Soleiman failed to, among other things, prioritise his clients' interests and act in their best interests.

Alisha Shamim, Maddocks Lawyers

Mr Soleiman's conduct

Mr Soleiman, a financial adviser from Wollert, Victoria, was an authorised representative of Apogee Financial Planning Limited during the period June 2013 to February 2019.

Mr Soleiman's conduct ASIC's finding

Clients approached Mr Soleiman for advice about establishing self-managed super funds (SMSFs) for the purpose of investing in property or property development companies. The clients were looking to invest through Mr Soleiman's brothers who were in the property development business.

Conflict of interest between Mr Soleiman's interests and that of his clients'.

In relation to advice provided to 4 clients, Mr Soleiman:

  • did not scope the advice to be consistent with his clients' circumstances and subject matter of advice sought;
  • did not make reasonable inquiries to obtain complete and accurate information about his clients' relevant circumstances;
  • did not address how an SMSF property investment strategy would meet his clients' retirement objectives;
  • focused the advice to his clients on rolling over to SMSFs without adequately considering alternative options;
  • did not adequately consider and provide information about significant risks and consequences when recommending his clients rollover their existing super funds to SMSFs for the purpose of investing into property; and
  • was told by his licensee that he did not have the required expertise to advise on SMSFs generally, but still proceeded to provide SMSF advice to his clients.

Mr Soleiman failed to prioritise his clients' interests and act in their best interests.

Implications and learnings

As a result, ASIC banned Mr Soleiman from providing financial advice for a period of 6 years, commencing 7 October 2019. This ban is recorded on ASIC's register of financial advisers. Mr Soleiman has filed an application to review ASIC's decision in the Administrative Appeals Tribunal.

Clients or prospective clients of financial advisers should:

  • be wary of conduct similar to that of Mr Soleiman's, namely advisors who recommend a pre-determined course of action - rolling super savings over into an SMSF to invest in property - without taking into account (or inquiring about) the client's existing super arrangements (including insurance policies), retirement plans and needs, nor the appropriateness of large property investments for those clients; and
  • remember the importance of obtaining quality SMSF advice that is tailored to their specific circumstances.

More information from Maddocks

For more information, contact Maddocks on (03) 9258 3555 and ask to speak to a member of the Commercial team.

More Cleardocs information on related topics

You can read earlier ClearLaw article on a range of topics

 

Lawyer in Profile

Leigh Baring
Leigh Baring
Partner
PH: 61 3 9258 3673

Leigh is a partner in the Maddocks Tax & Revenue team.

Leigh regularly provides advice on:

  • structuring of businesses and transactions;
  • mergers and acquisitions;
  • corporate reorganisations and distributions;
  • sale of businesses;
  • demergers;
  • capital raisings;
  • joint ventures and property developments;
  • international tax (both inbound and outbound);
  • succession planning; and
  • liquidations.

His advice covers both direct and indirect tax considerations.

Leigh advises Australian and multinational companies, high net worth individuals, accountants and financial advisers on all areas of taxation law.