On 28 June 2018, ASIC accepted a Court Enforceable Undertaking from Melbourne-based Dover Financial Advisers Pty Ltd and its sole director, Mr Terry McMaster. Mr McMaster is named as the Key Person on Dover’s AFS License (AFSL).
Under the terms of the Court Enforceable Undertaking, Dover will cease operating its financial services business by 6 July 2018, and apply to ASIC to commence the process to cancel its AFSL. Mr McMaster has also undertaken to remove himself permanently from the financial services industry.
The Court Enforceable Undertaking resulted from an ASIC investigation commenced in 2017, which included consideration of Dover’s “Client Protection Policy” (Protection Policy). ASIC was concerned that by intending to rely upon the Protection Policy Dover had failed deliberately and systematically for over two years to:
- comply with its obligations to act efficiently, honestly and fairly;
- comply with financial services laws; and
- take reasonable steps to ensure that its representatives comply with the financial services laws.
ASIC considered certain terms of the Protection Policy to be detrimental to clients and unfair under section 12BG of the ASIC Act because the terms:
- created a significant imbalance in the rights and obligations of the adviser and their client; and
- were directed to protecting the interests of Dover and its authorised representatives in avoiding liability to a client for bad advice,
and that these terms conflicted with the obligations of an AFSL holder under the financial services law regarding client complaints and claims.
ASIC was also concerned that Dover lacked the organisational competency required of an AFSL holder.
Due to his significant involvement in this conduct, ASIC was concerned that Mr McMaster, in his individual capacity and in his capacity as a responsible officer of Dover:
- is not of good fame and character;
impaired Dover’s ability to provide the Financial Services covered by the AFSL; and - is likely to contravene a Financial Services Law in the future.
ASIC’s investigation into Dover is continuing.
More details can be seen here.