ASIC precedent in advice compliance manager banning
The Australian Securities and Investments Commission (ASIC) investigation into the collapse of the Shield Master Fund has seen it break new ground with the banning of the compliance manager of the now delicensed MWL Financial Services.
ASIC announced that the compliance manager, John Tohill, had been banned for five years from providing any financial services, performing, as an officer, responsible manager or compliance any function involved in carrying on of a financial services business and controlling an entity that carriers on a financial services business.
It is the first time that the regulator has specifically banned a compliance manager and reflects the degree to which it is drilling down on the product and advice eco-system which existed around investment in the Shield Fund.
A few hours later, ASIC announced the cancellation of the MWL Financial Services license and the banning for 10 years of its managing director, Nicholas Maikousis.
Importantly, Tohill was not a relative novice when it came to his involvement in the financial planning sector and as a compliance manager with the regulator noting that he commenced with MWL in December 2016 and was appointed as one of the firm’s responsible managers in December, 2021.
Before that, Tohill had worked at Bendigo and Adelaide Bank and CGU Insurance Limited.
According to ASIC’s banning announcement Tohill was the responsible manager and compliance manager of MWL Financial Services Pty Ltd with the regulator finding that Tohill:
- was involved in contraventions of financial services laws by another person
- was on the investment committee that continued to evaluate and approve the Shield Master Fund (Shield)
- reviewed and approved template Statements of Advice (SOA) and certain SOAs prepared by financial advisers which contained:
- false and misleading information about the performance history of Shield, and
- no information about MWL’s arrangements with lead generators.
- was responsible for the content of Financial Services Guides that did not disclose required information about MWL’s arrangements with lead generators
- was responsible for maintaining MWL’s compliance manual which included MWL’s conflicts policy, and
- failed in his gatekeeper functions as compliance manager and responsible manager. ASIC has previously banned four former financial advisers of MWL in respect of advice provided in relation to Shield
OMG is ASIC actually doing its job ??
On the same basis what is ASIC doing about Nerida Cole, head of Advice and on Investment Committee at Dodgy Dixon’s ?
A good start, Nerida Cole next.
Nothing like being on the front foot a year too late.
Good work as always ASIC
So who, within ASIC, didnt act on the initial complaints for Shield? Is anyone within ASIC going to have their career terminated. Is there any type of review into the performance of ASIC?
Read Andrew Bragg’s report regarding ASIC from last year. It’s on the money.