media release (18-334MR)

Melbourne financial services and credit business to pay $9 million for multiple breaches of obligations and consumer protection laws


A Melbourne-based financial services and credit business has been ordered by the Federal Court to pay penalties of $8,980,000 in total after it engaged in numerous contraventions of financial services, credit and consumer protection laws.  

Financial Circle offered personal loans to consumers of up to $5,000 that could only be obtained if the consumer agreed to receive and implement financial advice. The advice typically recommended purchasing personal insurance products and switching superannuation providers. 

When consumers implemented the advice, significant advice fees were paid to Financial Circle directly from the consumer’s superannuation. Financial Circle also received ongoing commission payments from the insurers. This process often resulted in a substantial erosion – in many cases up to 30% – of the client's superannuation balances.

The Court found that in conducting this business Financial Circle:

  • made false and misleading representations and engaged in misleading and deceptive conduct;
  • engaged in unconscionable conduct;
  • breached its licensee obligations under its Australian financial services licence (AFSL), including obligations requiring that it:
    • take reasonable steps to ensure that its authorised representatives act in clients’ best interests and provide advice that is appropriate; and
    • do all things necessary to ensure that the financial services covered by its AFSL were provided efficiently, honestly and fairly; and
  • engaged in a credit activity without a licence authorising it to engage in that activity.

In addition to ordering that the company pay pecuniary penalties, the Federal Court ordered that it be permanently restrained from:

  • carrying on a financial services business; and
  • providing credit or entering into a credit contract as a credit provider.

The Court also made orders requiring the company to pay ASIC’s costs.

ASIC's MoneySmart website has information for consumers about financial advice, including how to complain about an adviser, and what to do if their adviser is banned

A link to the Federal Court orders and judgment can be found here. The Court will provide its detailed reasons shortly.


Financial Circle holds an Australian financial services licence which authorises it to advise clients about and deal in life risk insurance and superannuation products.  Financial Circle also holds an Australian credit licence which authorises it to engage in credit activities other than as a credit provider. Financial Circle authorised representatives to provide personal financial advice to retail clients who accessed their services via the website,

On 10 January 2018, ASIC obtained an order which, until the trial, restrained Financial Circle from carrying on a financial services business, including providing financial product advice or dealing in financial products, entering into contracts as a credit provider or promoting, advertising or offering loans or cash payments to prospective retail clients.

Further information on the injunctive orders can be found here (18-005MR). 

Editor's note:

On 19 November 2018, ASIC cancelled Financial Circle’s Australian financial services licence and Australian credit licence (18-362MR).

Media enquiries: Contact ASIC Media Unit