ASIC reboots Westpac advice test case
Two wealth arms of Westpac are under fire again from the corporate cop over controversial marketing campaigns that resulted in A$650 million of superannuation funds flowing into the BT funds management subsidiary.ASIC has relaunched a test case in the Federal Court against Westpac Securities Administration and BT Funds Management for alleged breaches between 2013 and 2016 of the Future of Financial Advice reforms.The regulator is appealing a decision of Justice Jacqueline Gleeson in the Federal Court last December that found ASIC could not demonstrate that the Westpac businesses gave "personal financial product advice" to customers during unsolicited telephone campaigns.ASIC alleges that each of the Westpac arms gave personal advice to prospective customers even though they were not authorised under their respective financial services licences.The regulator is also alleging that the subsidiaries failed to ensure that their financial services were provided "efficiently, honestly and fairly".The original test case was a mixed outcome for Westpac.While Justice Gleeson found that ASIC had not made a case that the two subsidiaries had provided personal advice, she did find that the businesses had failed to take all steps to ensure that the financial services were provided fairly and honestly.ASIC deputy chair Daniel Crennan said it was important for the regulator to get clarity from the court on the FOFA laws."The dividing line between personal and general advice is one of the most important provisions within the financial services laws," he said."It directly impacts the standard of advice received by consumers. "This is why ASIC brought this test case and ASIC believes further consideration by the Full Court of the Federal Court is necessary to better inform consumers and industry."The test case hinges on evidence relating to telephone calls made by the Westpac arms to 14 consumers.ASIC is seeking a right to appeal the original decision on grounds that the judge ought to have found that Westpac's telephone canvassers had considered the financial position of each customer.