The SMSF taskforce plans to establish a project team to investigate the business model structures of these operators and the risks they pose to investors, he said.
This comes in response to the recent collapse of the Charterhill Group, as reported by InvestorDaily earlier this month, which operated as a one-stop shop offering advice to clients on establishing SMSFs and sourcing and purchasing investment properties.
Mr Tanzer said ASIC has noticed a sharp increase in promoters recommending investors establish an SMSF or use an existing one to invest in property.
“These promoters may not be complying with the law,” he said.
Mr Tanzer said, under the Corporations Act anyone offering advice on financial products, including making a recommendation to set up an SMSF or use an existing SMSF to purchase property, must hold an Australian Financial Services Licence (AFSL) or be a representative of an AFSL.
“This is because the vehicle through which the underlying investment is made is an SMSF and an interest in an SMSF is a financial product,” he said.
“That is, a person who makes such a recommendation or statement of opinion provides financial product advice even where the underlying investment – property in this case – is not a financial product.”
Mr Tanzer said ASIC is concerned that with the increased popularity of SMSFs and property investment, real estate agents and property advisers may not realise this.
The other new area of focus for the SMSF taskforce is increasing its work on misleading advertising for SMSFs on websites, print and radio.
“This work will be expanded to cover online advertising channels such as Twitter, Facebook and YouTube,” he said.
ASIC will also be investigating SMSF seminars for evidence of “misleading and deceptive conduct, as well as any unlicensed financial services conduct,” said Mr Tanzer.
“Where we identify any breaches, regulatory action will be sought and we will look to issue an alert to industry and the public to be wary of shonky selling tactics at SMSF seminars,” he said.
