The Australian Securities & Investments Commission (ASIC) said the man, Andrew Peter Panayiotides, provided advice to clients that was inappropriate when considering the financial circumstances and objectives of the clients involved.
It said the adviser’s conduct resulted in each of the client’s superannuation accounts being significantly exposed to exchange traded options (ETOs) that were contrary to the risk profile declarations provided by the clients.
ASIC also found that Panayiotides knew, or ought reasonably to have known, that there was a conflict of interest between the financial benefit he received, in the form of brokerage, from the numerous ETO transactions he advised clients to enter into and his clients’ best interests.
ASIC further found that Panayiotides:
- improperly made payments into clients’ bank accounts using his own funds;
- issued a false invoice;
- provided unethical advice to a client in relation to a superannuation fund withdrawal; and
- entered into a personal loan arrangement with a client in return for offering reduced brokerage while at another firm.
“In considering Mr Panayiotides’ conduct, which was not of an isolated nature, was not inadvertent and occurred over a long period of time in which clients incurred significant losses, ASIC had reason to believe that Mr Panayiotides was likely to contravene a financial services law in the future and was not of good fame or character,” the regulator said in a statement on Friday.
ASIC commissioner Cathie Armour said: “Financial advisers are expected to act in the best interests of clients. ASIC will ensure appropriate enforcement action is taken against advisers who fail in this duty.”
Panayiotides was employed by Morgan Stanley Wealth Management between January 2013 and May 2015.