A group of former Solutions Wealth Strategies (SWS) advisers has moved to shut down the troubled dealer group by appealing to the firm's product providers to withdraw their product arrangements under a bankruptcy clause.
It is understood at least two product providers have withdrawn their product arrangements with SWS, with one provider believed to have cut off its $18,000 a month payment.
The advisers have taken it upon themselves to contact providers, sending an email, obtained by InvestorDaily, to companies believed to be AMP, BT, Colonial, Asteron, Macquarie, Aviva, ING and Axa.
"Please be advised that the sole responsible manager (RM) for Solutions Wealth Strategies Pty Ltd, Maurice Terreiro, is a bankrupt since March this year," the email said.
"It is possible that your company has a current product arrangement with SWS as many of the previous advisers to SWS stated that they wrote business with your company before having left this AFSL (Australian financial services licence) or are currently leaving this AFSL.
"A number of product providers have already withdrawn their product arrangements under their 'bankruptcy' clause in the last month due to the compliance and regulatory issues. We suggest that your company might like to ask a few questions or cut ties with this company for the reason above."
The advisers began contacting SWS's product providers last month after adviser complaints to ASIC failed to force SWS to pay them the $4 million in alleged unpaid money.
"ASIC are moving slowly with things due to the number of complaints and claims due to this 2007-2008 global economic crisis," one unnamed adviser said.
However, according to the adviser, there were more people coming forward with further debts related to SWS and its advisory subsidiary, Financial Wealth.
In July, ASIC was asked to investigate the activities of SWS and possibly its former managing director, Terreiro, after receiving a number of complaints against the group.
Seven of SWS's former advisers lodged official complaints with the corporate regulator against SWS and Financial Wealth.
The complaints relate to a number of alleged breaches of conduct by SWS and Financial Wealth while the advisers were employed with the firms.
