Wholesale clients are still owed a duty of care by financial advisers
Are you a wholesale investor, but unhappy with the advice you received from your financial advisor? FD Legal can assist you with recovering compensation.
Are you a wholesale investor, but unhappy with the advice you received from your financial advisor? FD Legal can assist you with recovering compensation.
There is a common misconception in the financial services industry that if a client is a “wholesale client” that a financial firm (and by extension its authorised representatives) cannot be held liable for providing negligent financial advice. This is not the case.
For the purposes of the Corporations Act 2001 (Cth), a “wholesale client” is a person (or Self Managed Super Fund) who:
(a) invests $500,000 or more in a single investment; or
(b) has assets of at least $2.5 million; or
(c) has earnt a gross income for each of the last two (2) financial years of at least $250,000 per year.
Recent Court judgements have clarified that a financial advisor cannot assume that a client, who meets the wholesale client criteria, has the knowledge or experience to understand financial products, or the accuracy of marketing material. Financial firms and their advisers still remain liable to wholesale clients pursuant to:
1. the common law duty to not make negligent misrepresentations; and
2. the common law duty to exercise reasonable are and skill when giving advice.
If you consider that you have received negligent financial advice, FD Legal can assist you to pursue the financial firm and financial adviser. Please contact FD Legal on 1300 433 533 or email enquiries@fdlegal.com.au to discuss your matter further.
