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Wednesday 20 October 2021

21-278MR ASIC bans Melbourne-based adviser for six years

ASIC has banned Melbourne-based financial adviser Ashok Sherwal from providing financial services and performing any function in a financial services business for six years.

Mr Sherwal advised clients in need of cash to replace their existing insurance and superannuation products, as well as to take out new insurance products, so that he could generate advice fees and insurance commissions. Mr Sherwal then used some of the fees and commissions he received to make cash payments to these clients. 

Mr Sherwal failed to identify the scope of the advice being sought by his clients, did not obtain complete and accurate client information, or base his judgement on his clients’ relevant circumstances. These failures led to his clients receiving inappropriate advice that resulted in their superannuation balances being significantly eroded.

Mr Sherwal also failed to comply with the additional disclosure requirements when providing product switching advice.

In making its decision, ASIC found that Mr Sherwal misunderstood what the best interests duty requires of him and demonstrated an inability to follow fundamental and proper financial advice processes.

Mr Sherwal prioritised his own interests above those of his clients, and he did not exercise the degree of professionalism and judgement demanded of financial advisers. ASIC also found that Mr Sherwal is not a fit and proper person due to his serious lack of professionalism and judgement.

Mr Sherwal’s banning is recorded on ASIC’s publicly available Financial Advisers Register and the Banned and Disqualified Persons Register.

Mr Sherwal has appealed to the Administrative Appeals Tribunal for a review of ASIC’s decision. The outcome has not yet been determined.

Background

Mr Sherwal has been an authorised representative of a number of advice licensees. The conduct that resulted in this banning relates to Mr Sherwal’s activities when he was an authorised representative of Wealth & Risk Management Pty Ltd (22 July 2015 - 4 May 2016) and Dover Financial Advisers Pty Ltd (6 March  - 23 October 2017).

Last updated: 20/10/2021 12:00