The Administrative Appeals Tribunal (AAT) has reduced the period and scope of the banning imposed on former Melbourne-based financial adviser, Ashok Sherwal.

Mr Sherwal was originally banned on 11 June 2021 from providing financial services and performing any function in a financial services business for a period of six years (21-278MR). The AAT reduced the period of the banning to five years, and reduced the scope of the banning to the provision of financial services and the performance of any function as an officer or manager of an entity carrying on a financial services business.

The AAT delivered its decision on 7 December 2022, following Mr Sherwal’s application for review. The AAT found that Mr Sherwal failed to act in his client’s best interests in advising them to place new superannuation funded insurance as part of their participation in a cash rebate procedure. The AAT found that Mr Sherwal failed to prioritise his client’s interests in the advice he gave and that there were instances of inappropriate advice and failures to comply with the additional requirements of advice which recommended the replacement of one product with another.

In reducing the period and the scope of the banning, the AAT formed the view that some aspects of ASIC’s decision reasoning were misconceived and that the cash rebate procedure was not itself unlawful. The AAT found that Mr Sherwal demonstrated that he is a “proper” person to be permitted to provide financial services, however had failed to discharge his basic obligations, and had demonstrated a lack of reliable care and attention in the consideration of his client’s affairs.

ASIC is considering the AAT decision. A copy of the AAT’s decision and reasons for the decision can be found here.

Background

Mr Sherwal has been an authorised representative of several advice licensees in the past. 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).