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Friday 2 March 2018

18-060MR ASIC permanently bans financial adviser for unethical conduct

The Australian Securities and Investments Commission (ASIC) has permanently banned Muneer Mahmood Khan (also known as 'Ivan Khan') from providing financial services after finding that he was not of good fame or character, and that he had acted unethically.

Between April 2012 and December 2012 Mr Khan obtained $185,800 from an elderly person who had been a client when he was a Senior Financial Planner with Westpac, and thus held him in a position of trust. At the time, Mr Khan had not disclosed that he was no longer employed by Westpac.

Mr Khan maintained that $125,000 was loaned to him to fund his development of a financial planning business and that the balance had been a gift from the client, however:

  • Mr Khan failed to ensure that his client obtained independent advice in relation to advancing funds to him;  
  • the funds were largely spent on personal expenses; and  
  • none of the funds were used to establish a business.  

ASIC found that Mr Khan's request that his client advance him money, whether as a gift or loan, was unethical. Mr Khan's client was a person in vulnerable circumstances, who was left in a financially perilous position because of Mr Khan's actions, which were opportunistic and egregious.

Additionally, despite repeated requests by his client for repayment, and Mr Khan's ability to return part of the funds that he had obtained, Mr Khan only repaid $10,270 to his client. Westpac has engaged with the customer about remediation.

Mr Khan's banning will be recorded on ASIC's Financial Advisers Register.  

ASIC's MoneySmart website has useful information for clients of advisers to help them understand what to do if their adviser has been banned. 

Mr Khan was a Senior Financial Planner with Westpac from May 2006 to March 2012. Additionally he was a Financial Planner at Yellow Brick Road Wealth Management Pty Limited from July 2013 to November 2014, and a Financial Planner with NAB from March 2015 to January 2017.

Mr Khan has appealed to the Administrative Appeals Tribunal (AAT) for a review and stay of ASIC's decision.

Background 

The banning of Mr Khan is part of ASIC's Wealth Management Project. The Wealth Management Project was established in October 2014 to lift the standards of major financial advice providers. The Wealth Management Project focuses on the conduct of the largest financial advice firms (NAB, Westpac, CBA, ANZ, Macquarie and AMP).

ASIC's work in the Wealth Management Project covers a number of areas including:

  • working with the largest financial advice firms to address the identification and remediation of non-compliant advice; and 
  • seeking regulatory outcomes, where appropriate, against licensees and advisers. 

As part of its Wealth Management Project, ASIC has banned 43 advisers and one director from the financial services industry. Four adviser bannings are the subject of appeals, with a further banning stayed pending the outcome of an appeal.

Editor's note:

Mr Khan has withdrawn his application to the Administrative Appeals
Tribunal for a review of ASIC’s decision. The application has been dismissed, effective 10 April 2019.

Last updated: 12/04/2019 12:00