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‘Shonky’ operators eye SMSFs as trustees shun advice
The negative sentiment towards financial advice and the increasing trend of self-directed investment is seeing SMSF trustees continue to be caught up in schemes established by dodgy operators, according to an industry lawyer.
Sophie Grace Lawyers director Sophie Gerber says while SMSF practitioners can do a lot to educate their clients about some of the property spruikers and other unscrupulous operators, many SMSF trustees aren’t in the advice system.
“You have some very competent advisers but they need to be able to explain their value to potential clients, because individuals have become so sceptical of advisers more generally,” Ms Gerber told SMSF Adviser.
“These investors want to manage their SMSF themselves, so self-directed investment is becoming a big trend.”
While financial advice clients are “becoming increasingly aware of shonky operators and very poor advisers”, Ms Gerber said these types of schemes are more actively targeting non-advised individuals in the SMSF space.
The recent investigation by ASIC into Macro Realty is one such example of this.
“Macro were actively targeting investor mum and dad kind of people to invest in the Pilbara region. That was an interesting one because ASIC had just licensed them, and then it fell apart pretty shortly afterwards,” Ms Gerber said.
“It’s very unfortunate that a lot of those issues weren’t picked up. I think it’s only a matter of time before people start to come out and say how much money they’ve lost from that scheme. It’s very still up in the air with the liquidator trying to work out what’s going on, but there will be a lot of losses.”
Miranda Brownlee
Miranda Brownlee is the deputy editor of SMSF Adviser, which is the leading source of news, strategy and educational content for professionals working in the SMSF sector.
Since joining the team in 2014, Miranda has been responsible for breaking some of the biggest superannuation stories in Australia, and has reported extensively on technical strategy and legislative updates.
Miranda also has broad business and financial services reporting experience, having written for titles including Investor Daily, ifa and Accountants Daily.
Continues to be be reports of crooked accountants as well Anon, only just yesterday an accountant convicted of theft from clients totalling $2.3M. I know of a number of accountants who have been banned from providing financial planning advice but who are still members of the Institute and who still continue to practice as chartered accountants. It would appear that there are tighter controls in planning but that the accounting bodies have a much more lax approach to what their members are doing. Or do they just turn a blind eye because it doesnt apply to their accounting work???0- I find it astounding that accountants can no longer recommend the establishment of an SMSF, yet there continues to reports of shonky financial advisers.0
- Very true about client education. But as the saying goes "you can lead a horse to water" etc. etc. And when the heart rules the head it is game, set and match.0
- Well there is 100 per cent proof that ASIC simply does not know what it is doing, first of all a rudimentary background check of the people behind this scheme should have discovered the shortcomings or deceit these people had in mind but no, ASIC didn't bother to do back ground checks and they have the nerve to dump on hard working advisers!0
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