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12-63AD ASIC accepts enforceable undertaking from former COMMONWEALTH Financial Planning adviser
ASIC has accepted an enforceable undertaking (EU) from former Commonwealth Financial Planning Limited (CFPL) employee, Mr Christopher Baker of Croydon, NSW, not to provide financial services in any capacity for a minimum of five years after he failed to meet various obligations as a financial adviser.
The EU follows an investigation into the advice provided by several of CFPL’s financial advisers. CFPL is a wholly owned subsidiary of the Commonwealth Bank of Australia (CBA) and operates under the advice structure of Colonial First State, which is also part of the CBA.
Between 1 March 2005 and 27 February 2009, Mr Baker was found to have:
- not properly completed a number of CFPL’s Financial Needs Analysis documents
- failed to determine the relevant personal circumstances and failed to make reasonable inquiries in relation to the personal circumstances of clients before implementing advice
- had a large proportion of clients that were profiled with aggressive risk profiles
- provided property asset allocations to clients which were far above the recommended asset allocation for their risk profile
- failed to provide a Statement of Advice to clients when he was required to do so, and
- failed to include a replacement product advice record in a Statement of Advice.
In addition to agreeing not to provide financial services in any capacity for a minimum of five years, Mr Baker has also undertaken to complete appropriate professional education requirements and must adhere to supervision requirements for six months should he decide to re-enter the financial services industry.
This latest outcomes follows investigations of other CFPL financial advisers, Simon Langton (see 12-02AD) and Don Nguyen (see 11-42AD) and reflects ASIC’s commitment to ensuring financial advisers meet required standards to maintain consumer confidence in the financial services system.
On 25 October 2011, ASIC accepted an EU from CFPL requiring them to conduct a comprehensive review of their risk management framework and develop a plan to address any deficiencies in that framework. Further, where clients are found to have been adversely impacted by the conduct of representatives, CFPL will consider the circumstances and appropriately remediate the client. See 11-229MR for further information.
Former clients of Mr Baker or clients of other CFPL advisers who feel they may be entitled to compensation should contact CFPL directly on 1800 507 281.
ASIC’s investigation into the conduct of several other former CFP advisers is continuing.