Federal Court clears Diversa on ASIC charges

The Australian Securities and Investments Commission (ASIC) has had a decision against superannuation trustee Diversa overturned in the Federal Court.

The issue related to ASIC having alleged that Diversa contravened the law by allowing AustralianSuper Finder, Australian Dealer Group and a financial adviser, Nizi Bhandari, to sign consumers up to its YourChoice Super product between 13 March 2019 and 18 December 2020.

ASIC had alleged Diversa and the OneVue Group (which provided many day-to-day functions for the YourChoice Super fund) knew or should have known that the Australian Super Finder business was engaging in concerning behaviour and was at risk of breaking the law.

ASIC alleged that the OneVue Group paid approximately $7.5 million in commissions on behalf of Diversa.

The regulator acknowledged today that the Federal Court had found that Diversa Trustees did not fail to act efficiently, honestly and fairly or fail to take reasonable steps to ensure its representatives complied with financial services laws.

ASIC said it is reviewing the judgement.

Providing background, ASIC said Australian Dealer Group (ADG) operated a website called ‘Australian Super Finder’ through which a consumer could request a search for lost superannuation. ADG offered to consolidate a consumer’s ‘found’ superannuation into a single fund.

It said Bhandari was permanently banned by ASIC from providing financial services and engaging in credit activities in March 2021. ASIC found he had acted dishonestly while assisting consumers to find and consolidate their superannuation and obtain hardship payments. ASIC found that, because of ADG and Mr Bhandari’s conduct, consumers paid financial advice fees and were potentially exposed to harm, including loss of insurance held through superannuation, extra fees and ATO penalties.