LFG Financial Services Ltd advisor sold clients investments without consent, required to compensate client
In a recent AFCA case a financial advisor of LFG Financial Services Ltd was required to compensate his clients over $40,000 for selling their investment portfolio without the client’s consent.
In a recent AFCA case a financial advisor of LFG Financial Services Ltd was required to compensate his clients over $40,000 for selling their investment portfolio without the client’s consent.
AFCA held that the clients held a non-discretionary account with LFG Financial Services and the advisor was required to contact the client before liquidating their portfolio. Whilst LFG Financial Services accepted that they did not contact the clients before selling their portfolio, it maintained that the clients would have accepted this advice (had they received it).
AFCA disagreed finding that the advisor acted without authority and had previously advised the clients to not “panic sell”. Despite this advice, the advisor acted contrary to the clients long term investment strategy and sold their shares.
Advisors must not act without client’s instructions
Unless a financial advisor has a Managed Discretionary Agreement with a client, they cannot buy and sell shares at their discretion. A client should be contacted first before an investment is bought or sold on their behalf. If you have experienced your financial advisor buying or selling shares without your consent, you could have a claim for compensation. Contact FD Legal to enquire if you can commence a claim to recover compensation.
We are committed to ensuring clients receive the best possible advice and guidance on their situation, especially in SMSF advice cases. You can contact us online, call us on 1800 433 533 or email us at enquiry@fdlegal.com.au
