12/06/2019 - 14:42

ASIC takes on RM Capital

12/06/2019 - 14:42

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The Australian Securities and Investment Commission has begun civil proceedings against Perth-based RM Capital, alleging that an authorised representative for the firm was engaged in conflicted remuneration.

Each of the 259 payments could attract a penalty of up to $1 million, according to ASIC.

The Australian Securities and Investment Commission has begun civil proceedings against Perth-based RM Capital, alleging that an authorised representative for the firm was engaged in conflicted remuneration.

In the first case it has brought to court concerning a breach of conflicted remuneration provisions, ASIC alleges that on more than 250 occasions between 2013 and 2016, The Self-Managed Superannuation Funds (SMSF) Club, an authorised representative of RM Capital, advised clients to use their SMSF to buy property from Positive RealEstate Pty Ltd.

In turn, Positive RealEstate would pay around $5,000 to SMSF Club, totalling $730,000 in conflicted remuneration over the three-year period.

In laying out a case against the firms, ASIC said that the payments could be thought to have influenced financial product advice given by SMSF Club to its clients.

The commission also alleges that, as RM Capital was aware of the payments, it did not take reasonable steps to stop the SMSF Club from accepting them.

“ASIC contends that as the authorising licensee for SMSF Club, RM Capital’s failure to take reasonable steps to ensure SMSF Club’s compliance also breached the law,” it said.

Each of the 259 payments could attract a penalty of up to $1 million, according to ASIC.

SMSF Club has been approached for comment.

RM Capital declined to comment for this story.

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