Sydney based financial advice boutique Omniwealth included a page on it’s website on the advantages of investing in property within a SMSF and compared the performance of a geared property investment within a SMSF to an ungeared equity investment within SMSF, ASIC said in a public statement.
“The webpage was also promoted through the social media profile of Omniwealth's CEO with a statement that investing in property in a SMSF has taxation, leverage and diversification advantages and included a link to the Omniwealth webpage's related article,” said ASIC.
ASIC said it was concerned the webpage did not give a balanced message about the returns, benefits and risks of investing in property in a self-managed super fund, and in particular that the uncertainty of forecasts was not made clear.
Omniwealth has since removed the statements from its website and related social media profiles and has fully cooperated in responding to ASIC’s concerns, the statement said.
ASIC deputy chair Peter Kell said making appropriate investment decisions is one of the important responsibilities of SMSF trustees.
“ASIC is determined that SMSF trustees get accurate information and are not misled by advertising, including on websites and through social media,” said Mr Kell.
As the use of social media for promoting financial products and advice services increases ASIC said it is important financial consumers are not misled or misinformed.
“ASIC encourages financial services providers using social media to regularly review their content and consider ASIC's guidance on promoting financial products and advice services in Regulatory Guide 234 Advertising financial products and advice services including credit: Good practice guidance,” said ASIC.
Speaking to SMSF Adviser, chief executive office Matthew Kidd said the penalty came as a “massive surprise” for the Omniwealth team.
He said the firm has third-party compliance managers who had not picked up any forms of infringement and consider themselves “good corporate citizens of ASIC.”
Further, Mr Kidd said the firm wasn’t consulted before being hit with the fine.
“We put a detailed to submission to ASIC about why the fine should be reconsidered and we were knocked back. And we were disappointed because this was based on a potentially misleading claim, not actual misleading claim,” he said.
However, Mr Kidd stressed Omniwealth has been apologetic and has fully cooperated with ASIC.