ASIC has banned Gold Coast adviser Daniel John Renneberg from providing financial services for five years after a surveillance found that he had failed to act in the best interests of his clients.
ASIC reviewed the advice Mr Renneberg had provided to 15 of his clients while he was an authorised representative of Austplan Pty Ltd.
On reviewing the files, ASIC found that Mr Renneberg received referrals from GM Homes Australia Pty Ltd (GM Homes) to help their clients establish self-managed superannuation funds (SMSFs) to purchase an investment property.*
ASIC found that Mr Renneberg had not provided the clients appropriate financial advice or acted in their best interests. He had advised some clients to set up SMSFs with limited recourse loan arrangements that were completely unsuitable and placed his clients in a vulnerable financial position.
Mr Renneberg completely failed to consider his clients’ needs, objectives and circumstances. Mr Renneberg also failed to give his clients statements of advice that set out the advice he provided and the information on which he based his advice.
ASIC Commissioner Danielle Press said, 'SMSFs are not for everyone and using an SMSF to borrow money and buy a property is a high-risk strategy. ASIC will be looking very carefully at advisers who recommend this strategy and taking swift action where we see problems.
'Financial advisers must not rely solely on client direction when establishing an SMSF. They must adequately demonstrate why an SMSF is appropriate and why it is in their clients’ best interests.
'ASIC expects financial advisers to use their skills, expertise and judgement in determining whether an SMSF is indeed appropriate for their clients’ personal circumstances and needs,' Ms Press said.
An SMSF comes with a lot of responsibility and involves significant time and effort and may be suitable if consumers have extensive knowledge of financial and legal matters. They also need to consider their legal responsibilities and the tax implications when deciding to establish an SMSF.
ASIC’s MoneySmart website provides useful information for consumers about SMSFs and important questions to ask before setting up an SMSF. Consumers can also find out more about what to do if their adviser has been banned.
Mr Renneberg has the right to seek a review of ASIC's decision before the Administrative Appeals Tribunal.
Background
An ASIC surveillance of Austplan Pty Ltd found deficiencies in the financial services provided by a number of its representatives. ASIC was concerned about Austplan’s ability to do all things necessary to ensure the advice provided by its representatives complied with the law. Austplan’s Australian financial services (AFS) licence was cancelled by agreement with ASIC on 25 November 2018. (MR18-323).
Mr Renneberg was an authorised representative of Austplan (from 1 March 2015 to 5 June 2018) and its sole director when Austplan’s AFS license was cancelled. He was previously an authorised representative of Professional Investment Services Pty Ltd (from 11 April 2006 to 14 May 2010).
Editor's Note on 9 March 2021
For the avoidance of doubt, as at the date of this Editor's Note ASIC is not investigating GM Homes (Australia) Pty Ltd (GM Homes). Furthermore, ASIC has not made any findings of misconduct in respect of GM Homes or in respect of its dealings with Austplan Pty Ltd.