A former Victorian insurance adviser has been permanently banned from providing financial services after it was found he operated a business model that prioritised his own interests ahead of clients.
ASIC found that former Guardian Advice insurance adviser Andrew Moroney failed to comply with financial services laws by annually recommending his clients replace one insurance policy with another.
“Conduct by advisers aimed at maximising commission by replacing insurance policies, without valid reason, is unacceptable,” says ASIC Deputy Chairman Peter Kell.
“It puts clients’ coverage at risk and drives costs in the sector, which are ultimately borne by consumers.”
Moroney was an Authorised Representative of Guardian Advice from March 2006 to April 2014.
ASIC says Moroney’s business model for his advice practice meant he received a high up-front commission payment each year for each replaced insurance policy.
Clients who entered into a new life insurance policy annually were put at risk of exclusionary periods or revised terms, ASIC adds.
“ASIC will remove advisers whose conduct breaches financial services laws and falls short of the standards expected of the industry,” Kell says.
ASIC decided to ban Moroney permanently after finding that he:
– Failed to make reasonable enquiries into the circumstances of clients before providing advice;
– Failed to conduct reasonable enquiries into insurance policies, both those already held by clients and alternative policies;
– Incorrectly stated he had undertaken research on alternative life insurance policies;
– Failed to demonstrate that the advice he provided to the clients was in the best interests of his clients; and
– Prioritised his own commercial interests ahead of the interests of the clients.
Moroney has the right to apply to the Administrative Appeals Tribunal for a review of ASIC’s decision.