The AAT has refused to extend the stay of an ASIC decision to permanently ban a financial services adviser from providing financial services.
The AAT said the adviser is employed by an accounting firm, and on 30 October 2012, ASIC made a banning order permanently prohibiting the adviser from providing financial services. That decision was made pursuant to ss 920A and 920B of the Corporations Act 2001. The adviser is seeking review of that decision by the AAT.
The AAT noted that ASIC’s statement of reasons in conjunction with the banning order disclosed that serious findings had made against the adviser: among other things, ASIC was satisfied the adviser had engaged in misleading or deceptive conduct, forged the signatures of clients and made false file notes. The Tribunal noted the serious consequences and damage that would be done to the adviser if publication of ASIC’s decision went ahead.
However, it also said it was informed that the principal of the accounting firm was unaware of the adviser’s “current predicament”. It said the principal’s interests would probably be prejudiced if a further stay were ordered because “she would be placed in a potentially embarrassing position with respect to her clients”.
The AAT had issued a temporary stay preventing ASIC from publishing the decision or making entries onto the public register, which would ordinarily occur following a banning order. It considered that while the consequences were serious for the adviser, the interests of the investing public (including the adviser’s existing clients) took precedence. The Tribunal therefore declined to extend the stay and said “ASIC must go ahead and do what it is required to do”.
(AAT Case [AATA] 779, Re Gillespie and ASIC, AAT, McCabe SM, AAT Ref: 2012/5006, 8 November 2012.)
[LTN 219, 12/11]