Australian regulator bans adviser for three years and bank manager for life from the financial services industry

The Australian Securities & Investments Commission (ASIC) has been busy on the enforcement front this week.

In the first case the ASIC has banned a Spectrum Wealth financial adviser for three years. Gurumukh Singh Mehra has been banned from providing financial services for a period of three years, after ASIC surveillance showed he failed to act in his clients’ best interests. Through ASIC’s surveillance of life insurance advice, it was found Mr Mehra had failed to:

• make reasonable enquiries into his clients’ relevant circumstances, such as obtaining existing superannuation and insurance information;
• adequately investigate the clients’ existing financial products prior to making insurance recommendations;
• compare the features and costs of any existing insurance with that recommended to clients; and
• base all judgments on the clients’ relevant circumstances.

In the second case an ongoing ASIC investigation has resulted in the permanent banning of former National Australia Bank (NAB) branch manager Mathew Alwan from engaging in credit activities and providing financial services. The ban is the result of an extensive ASIC investigation in respect of NAB employees in greater western Sydney who were accepting false documents in support of loan applications and falsely attributing loans as having been referred by NAB introducers in order to obtain commissions. This conduct was the subject of the first case study before the Financial Services Royal Commission. From 2012 to 2015, Mr Alwan assigned 101 home loans as being referred to NAB by an introducer, causing a total of $186,725 to be paid to the introducer by way of commission. ASIC found in 25 of these loan applications, Mr Alwan had knowingly given NAB false or misleading information and documentation. Read more of this press release here.