The 10-year conviction, delivered by the District Court in New South Wales, is believed to be the harshest and longest sentence to be ever handed to an adviser in the country.
Gabriel Nakhl was found guilty of suggesting his clients set up self-managed superannuation funds and invest in shares, managed funds and high interest rate bank accounts, the Australian Securities and Investments Commission (Asic) said.
His misconduct affected 12 clients who allowed Nakhl to invest A$6.7m (£3.6m, $4.7m, €4.2m), and lost A$5.1 as a result.
“Mr Nakhl deliberately misled his clients and used their savings as he pleased. Clients should be able to trust their financial advisers.
“In this case, Mr Nakhl dishonestly and deliberately breached his clients’ trust. Asic welcomes the sentencing decision handed down today,’ Sean Hughes, Asic Commissioner, said.
At the time, Nakhl was a representative of Australian Financial Services, which has since gone into liquidation, and was also the sole director of SydFA which is now deregistered.
Asic froze his assets, valued at approximately A$7.7m, in February 2013; and, in September 2013, Nakhl declared bankruptcy and put SydFA into liquidation.
In November 2013, he was banned from providing financial services permanently, as well as not permitted to manage a company until 2028.