The Australian Securities and Investments Commission (ASIC) will have undercover investigators expose property spruikers and identify dishonest practices as part of a planned probe into self-managed super funds, deputy chairman Peter Kell has revealed.
Although the regulator is not responsible for regulating the real estate industry or sale of property, new court documents will allow the regulator to investigate spruikers, as reported by the Australian Financial Review (AFR).
Property spruikers invite people to their “wealth creation” seminars, often for free, with the promise of investment tips or opportunities, the government said. They typically promote a property investment system or market a specific property development.
“Consumer protection agencies across Australia have found many property spruikers cannot substantiate the success stories and claims of profits they promote.” Many consumers have had to take legal action to try to recover losses after relying on deceptive claims, it added.
The government said some spruikers sell information about investing in property using a self-managed superannuation fund (SMSF). “While some experienced investors may benefit from this kind of arrangement it is not to be undertaken lightly.”
ASIC did not reveal when it plans to send out the investigators.
"Our particular concern is the quality of financial advice,” Kell told the AFR. "Whether it is given in such a way as SMSF investors understand their obligations, requirements and experience needed to make a decision."
The report said increased funding will be used to complement ASIC regulators with outside undercover assistants. They will seek advice from financial advisers on self-managed super.
“Property spruikers are motivated to gain money at your expense. Don’t risk your money and assets because of their misleading advice,” the government said.
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