ASIC has permanently banned Queensland-based financial adviser, Mr Thanh Quoc Tu, from engaging in providing financial services.

For most of the period of his misconduct, Mr Tu was employed as an adviser by Patersons Securities Limited in its Brisbane office and later, at Cognitive Wealth Pty Ltd.

An ASIC investigation found that between September 2008 and December 2013, Mr Tu acted dishonestly in relation to clients’ funds and engaged in conduct to conceal his behaviour.

In particular, Mr Tu:

• misled investors to believe that their funds would be invested in a specific range of investment products, which he instead traded in another manner or applied for his own use through his personal trading account, and

• misled 18 separate individual client investors to invest a total of approximately $9,179,073.53 in various types of investment products, with only 10% of the money being returned to investors.

As a result of these findings, ASIC has determined to permanently ban Mr Tu on the grounds he is not of good fame or character and that it has reason to believe Mr Tu contravened a financial services law.

ASIC Commissioner, Mr Peter Kell, said that Mr Tu’s misconduct was very serious.

‘ASIC will ensure anyone who acts dishonestly and places their own interests ahead of those they advise will be removed from the financial services industry’, Mr Kell said.

Mr Tu has the right to appeal to the Administrative Appeals Tribunal for a review of ASIC’s decision.

Background

Mr Tu commenced employment with Patersons Securities Limited (Brisbane) (Patersons) in September 2008 as a private client adviser where he provided advice to and invested funds for predominately Vietnamese and elderly clients. Patersons terminated Mr Tu’s employment in September 2013.

Mr Tu was subsequently employed as executive investment adviser by Cognitive Wealth Pty Ltd (Cognitive) until the company became aware of an ASIC investigation and action by ASIC to restrict his travel in December 2013. Mr Tu’s employment with Cognitive was terminated on 19 December 2013.

Patersons reported Mr Tu’s conduct to ASIC and has assisted ASIC during its investigation. As a result of Mr Tu’s conduct, Patersons implemented a remediation program that was communicated to all of the affected client investors. ASIC understands that a number of the affected client investors have satisfactorily resolved their concerns with Patersons. ASIC will continue to monitor the remediation program. Further information can be obtained from Patersons on 1300 582 256.

ASIC is also continuing inquiries with Patersons into their compliance framework and compliance response.

Mr Tu’s banning follows ASIC obtaining Supreme Court orders on 19 December 2013 requiring Mr Tu to immediately surrender all of his passports and any visa for any other country to the Registrar of the Supreme Court in Brisbane. The court also ordered that Mr Tu be prohibited from leaving Australia without its consent

ASIC’s investigations are continuing.

Editor's note:

On 18 January 2015, Mr Tu was sentenced to nine-and-a-half years imprisonment in the Brisbane District Court, after pleading guilty to fraud charges (refer: 16-007MR).