An Australian Federal Court has slapped Dixon Advisory and Superannuation Services Limited, known as Dixon Advisory, with a monetary penalty of AU$7.2 million, the Australian Securities & Investments Commission (ASIC) announced on Monday.
In addition, the company has to pay the regulator AU$800,000 to cover its legal cost.
The penalty came as six representatives of Dixon Advisory failed to act on their duties of securing client interest and providing them with the best financial advisory. These representatives violated the regulations on 53 occasions between October 2015 and May 2019.
“Licensees need to ensure their representatives are taking into account their client’s specific needs and circumstances,” said Sarah Court, ASIC’s Deputy Chair.
“Advice that fails to reflect client circumstances − or advice models that lead to one-size-fits-all outcomes – are less likely to meet best interest duty obligations and can expose clients to a risk of capital loss.”
A Troubled Company
Earlier this year, ASIC canceled the operating license of Dixon Advisory following the appointment of external joint administrators.
Dixon Advisory provides a range of financial services. According to its website, its offerings include strategic financial advice, investment advice, estate planning and much more.
The troubles started in 2020 when the Aussie regulator slapped civil penalty proceedings against the company for alleged conflicts, best interest failures and inappropriate advice.
The mounting penalties were so grave that the administrators even asked several clients of Dixon to transition to alternative financial services advisory platforms. The insolvency of the company was already expected after clients’ claims and two class action lawsuits in late 2021.
The regulator and Dixon agreed on July 2021 to resolve the civil penalty issues as the firm admitted to several allegations.
“The infringements were not the result of isolated or unauthorized conduct of the representatives. Six representatives committed the contraventions spanning some three and a half years,” Aussie Justice McEvoy stated.
An Australian Federal Court has slapped Dixon Advisory and Superannuation Services Limited, known as Dixon Advisory, with a monetary penalty of AU$7.2 million, the Australian Securities & Investments Commission (ASIC) announced on Monday.
In addition, the company has to pay the regulator AU$800,000 to cover its legal cost.
The penalty came as six representatives of Dixon Advisory failed to act on their duties of securing client interest and providing them with the best financial advisory. These representatives violated the regulations on 53 occasions between October 2015 and May 2019.
“Licensees need to ensure their representatives are taking into account their client’s specific needs and circumstances,” said Sarah Court, ASIC’s Deputy Chair.
“Advice that fails to reflect client circumstances − or advice models that lead to one-size-fits-all outcomes – are less likely to meet best interest duty obligations and can expose clients to a risk of capital loss.”
A Troubled Company
Earlier this year, ASIC canceled the operating license of Dixon Advisory following the appointment of external joint administrators.
Dixon Advisory provides a range of financial services. According to its website, its offerings include strategic financial advice, investment advice, estate planning and much more.
The troubles started in 2020 when the Aussie regulator slapped civil penalty proceedings against the company for alleged conflicts, best interest failures and inappropriate advice.
The mounting penalties were so grave that the administrators even asked several clients of Dixon to transition to alternative financial services advisory platforms. The insolvency of the company was already expected after clients’ claims and two class action lawsuits in late 2021.
The regulator and Dixon agreed on July 2021 to resolve the civil penalty issues as the firm admitted to several allegations.
“The infringements were not the result of isolated or unauthorized conduct of the representatives. Six representatives committed the contraventions spanning some three and a half years,” Aussie Justice McEvoy stated.
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