Former financial and insurance director disqualified – July 3, 2024
Christian Oey, a former financial and insurance services industry director, has been disqualified from managing corporations for five years due to his involvement in three failed companies.
He was the director of Clickthru Pty Ltd and O’Corp Media Pty Ltd between May 1999 and November 2018, and an officer of Cornerstone Growth Capital Pty Ltd from September 2019 to March 2021.
Oey was found to have acted improperly and failed to meet his obligations when he:
- failed within the financial management of Clickthru Pty Ltd and O’Corp Media Pty Ltd, including not meeting taxation obligations;
- improperly used his director’s positions to gain advantage for himself and others – which caused detriment to the companies;
- failed to prevent Clickthru Pty Ltd from incurring debts while it was insolvent;
- failed to hold monies on trust, which were subsequently used for unauthorized purposes to the detriment of Cornerstone Growth Capital Pty Ltd and investees; and
- breached undertakings to the Federal Court in relation to the property of O’Corp Media Pty Ltd.
At the time of ASIC’s decision, the companies owed a combined total of A$5,850,309 ($3,903,507) to creditors, including A$482,289 ($321,798) to the Taxation Office and over A$500,000 ($333,612) to small business creditors.
Court updates
PayPal Australia used an unfair contract term – July 5, 2024
The Federal Court has followed ASIC’s earlier charges and declared that PayPal Australia Pty Limited used an unfair term in its standard form contracts with small businesses.
The term was found unfair because it allowed PayPal to retain fees that it had erroneously charged small business if they failed to notify the company of the error within 60 days.
PayPal, which has cooperated with and voluntarily assisted ASIC during this investigation, has also agreed that the term was unfair and consented to the declarations, and had the term removed from its contracts on November 8, 2023. The company will also pay ASIC’s litigation costs.
“Today’s decision serves as a reminder to all businesses that unfair contract terms contained within standard form contracts with small businesses will not be tolerated.”
Deputy Chair Sarah Court
AAT varies ban of Sydney financial adviser – July 5, 2024
The Administrative Appeals Tribunal has amended ASIC’s ban on Christopher Betalli from providing financial services, and it will now end on April 24, 2025.
AAT amends permanent ban against Todd Karamian – July 3, 2024
The Administrative Appeals Tribunal has changed the earlier permanently ban Todd Karamian to a seven-year ban.
Karamian was earlier permanently banned from providing or carrying out any services within the financial sector after falsifying his financial adviser exam result. He also provided personal advice to 11 retail clients without being legally authorized to do so.
Cancelled AFS licenses
HLK Group Pty Ltd – July 2, 2024
The Australian financial services (AFS) licence has been cancelled for HLK Group Pty Ltd for six months until December 27 because the company has currently ceased carrying on a financial services business.
ASIC news week 27
June 2024 financial adviser exam results
The 25th Financial Advisers Exam cycle, which was held in June, had:
- 235 people taking the exam;
- 70% (165) passed it; and
- 67% (158) took the exam for the first time.
To date, 21,260 individuals have taken the exam, and over 19,692 (92%) have passed it.
ASIC calls on AFS licensees to correct records
AFS licensees need to assess their records on their financial advisers on the Financial Advisers Register after findings of errors and inconsistencies in some of the information.
ASIC is therefore urging AFS licensees to immediately check all the provided information about their financial advisers on the Financial Advisers Register, especially on:
- the adviser’s approved qualification(s);
- ability to provide tax (financial) advice services;
- business address; and
- telephone number.
“It is a serious offence to knowingly provide false or misleading information to ASIC or to fail to take reasonable steps to ensure that the information provided to ASIC is true and correct,” the Commission said.
Update to superannuation forecasts relief instrument
In view of the Treasury’s revised long-term wage growth forecasts, ASIC is now proposing to update the rate of nominal wage inflation in ASIC (Superannuation Calculators and Retirement Estimates) Instrument 2022/603, and Regulatory Guide 276 Superannuation forecasts: Calculators and retirement estimates.
To reflect long-term economic conditions, ASIC proposes to revise the prescribed rate of nominal wage inflation from 4% p.a. to 3.7% p.a. in Instrument 2022/603 and RG 276, which will also align with the default rate with the long-term forecast of nominal wage inflation in the Treasury’s 2023 Intergenerational report.
Feedback on the proposal can be submitted until August 2.
Super trustees need to strengthen oversight of retirement strategy implementation
ASIC and the Australian Prudential Regulation Authority (APRA) are urging superannuation trustees to enhance their efforts to track and measure strategy impacts so they can improve retirement outcomes for members.
Even though trustees have made good progress, a recent pulse check also shows that some significant gaps remain.
When surveying trustees, several challenges have been highlighted regarding implementing the covenant, which was implemented 2022, including:
- uncertainty around the financial advice framework;
- privacy, security, and cost concerns on collecting more member data; and
- a lack of member engagement and financial capability.
“The most concerning finding from this survey is the lack of progress being made by trustees in tracking the success of their strategies, especially as this was highlighted as one of the key areas in need of improvement in the thematic review report,” said APRA Deputy Chair Margaret Cole.
“Without effective success metrics, how can trustees know that their strategies are working? Members deserve better.”
