SMSF practitioners continue to be harassed by property developers offering large commissions to spruik certain developments, according to the practice principal of an advice firm and the ATO.
Moran Howlett Financial Planning principal Cameron Howlett said his advice firm is constantly inundated with calls and emails from large property developers offering significant commissions for spruiking property to clients.
“They’re talking about 5 or 10 per cent commissions off the plan – it’s just ridiculous,” Mr Howlett told SMSF Adviser.
“There are probably a few advisers out there who have shifted into that space because it’s the next way of making a quick, easy dollar, which absolutely drives us nuts.”
At a recent event held by Partners Wealth Group, ATO director for SMSF risks and products, Nathan Burgess, said the ATO has also seen evidence that this is still occurring within the financial advice and accounting industries.
“ASIC has warned that such commissions or benefits may be conflicted remuneration and that financial advisers may be banned from receiving them,” said Mr Burgess.
Mr Howlett added that he has had many individuals come to his firm who have gone down the path of setting up limited recourse borrowing arrangements, establishing the bare trusts and then realising it is not the best idea to have excessive debt in their superannuation fund.
“I think that’s been a legitimate concern for a lot of practices in the industry for a while because we’re seeing it at the coal face,” he said.
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