Adviser given five-year ban following AFSL cancellation

The banning of Frazer Jon Muscat follows an ASIC surveillance that looked at advice he provided to clients when he was an authorised representative of Bristol Street Financial Services, according to a statement.

ASIC cancelled the licence of Bristol Street Financial Services in December last year after it found it had widespread non-compliance with a number of laws.

Its review of Mr Muscat’s advice found that he failed to take into account his clients’ individual circumstances because he used a templated approach for all clients.

ASIC found that he developed an ‘insurance needs calculation template’, which recommended his clients apply for levels of insurance that were higher than their circumstances required. In many cases, his recommendations were at complete odds with his clients’ current objectives and needs.

It said Mr Muscat also switched the superannuation accounts of some clients from one provider to another without investigating their existing arrangements and, in other cases, he recommended switching to a more expensive product without demonstrating that the switch would be in his clients’ best interests.

In focusing his advice on switching insurance and superannuation, ASIC also found that Mr Muscat failed to provide advice on other relevant areas specifically requested by his clients, such as debt reduction and cash flow management.

“When providing personal advice, ASIC expects financial advisers to take reasonable steps to understand their clients’ individual circumstances, needs and objectives before making any recommendations,” said ASIC commissioner Danielle Press.

“Advisers have a legal obligation to act in the best interests of their clients at all times and, because client circumstances often vary considerably, using a templated approach will not produce the most appropriate advice recommendations in all instances.”

The banning of Mr Muscat has been recorded on ASIC’s Adviser Register.

Adrian Flores

Adrian Flores is a deputy editor at Momentum Media, focusing mainly on banking, wealth management and financial services. He has also written for Public Accountant, Accountants Daily and The CEO Magazine.

You can contact him on [email protected].