ASIC takes collapsed firm to court for remuneration breaches

In a statement, ASIC said it had initiated the legal action against liquidated group DOD Bookkeeping, formerly known as Equiti Financial Services (Equiti FS).

Equiti FS was part of the Equiti Group of companies that offered SMSF establishment and administration services, real estate and mortgage broking services.

“ASIC alleges that, between 26 October 2015 to 27 August 2018, Equiti FS paid three advisers bonuses totalling $164,750 upon settlement of property purchases those advisers recommended their clients make through either an existing SMSF or an SMSF to be established,” the regulator said.

“The bonuses applied to purchases arranged by Equiti Property.

“ASIC alleges that these bonus payments breached the ban on conflicted remuneration under the Corporations Act 2001 because they could reasonably be expected to influence the financial product advice provided, or the choice of financial product recommended, by Equiti FS advisers to retail clients.”

ASIC also alleged advisers employed by the group gave advice to 12 clients between 2015 and 2018 that was not in their best interests.

“Each advice contained a recommendation to establish an SMSF, purchase a property through the SMSF and borrow funds in order to do so,” the regulator said.

ASIC is seeking civil penalties and other orders against Equiti FS.