ASIC bans financial planner after fake commission rort

The Australian Securities and Investment Commission has permanently banned a former AMP financial planner after he submitted 55 fake insurance applications so he could get more than $700,000 in commissions.

ASIC launched an investigation into the conduct of Vince Aloisi of Baulkham Hill in New South Wales after being informed of potential problems by AMP Financial Planning itself.

The investigation revealed that Aloisi had engaged in “dishonest conduct” between January 2007 and August 2009 by submitting 55 applications for life and income protection insurance to AMP Life Limited.

The corporate watchdog says the names on the applications were either fake, or were the names of people who did not genuinely intend to buy the policies.

ASIC says the rort resulted in AMP Life paying Aloisi $700,000 in commission, “which he then used for his own purposes”.

“AMP Life has recovered all the commission dishonestly obtained by Mr Aloisi. No clients of AMP suffered any loss as a result of Mr Aloisi’s conduct,” ASIC reported in a short statement.

Aloisi can still apply to the Administrative Appeals Tribunal for a review of ASIC’s decision.

The ban handed down to Aloisi comes as the Federal Government and the financial services sector wrestle with plans to prevent financial advisers from receiving any commissions.

Under a sweeping reform plan released by former Financial Services Minister Chris Bowen. In April, financial planners would be forced to adopt a fee-for-service model, or charge clients a percentage of fees under management.

The plan was endorsed by major financial planner associations, but the legislation was not introduced prior to the federal election and the timing now remains uncertain.