Australian Securities and Investments Commission v Ultiqa Lifestyle Promotions Limited (in liq)

The Australian Securities and Investments Commission (ASIC) brought proceedings against Ultiqa Lifestyle Promotions Limited (in liquidation) in the Federal Court, seeking declarations, pecuniary penalties, injunctions, and costs. ASIC alleged that Ultiqa had contravened sections 961L, 912A(1)(a), and 912A(1)(ca) of the Corporations Act 2001 (Cth) by failing to ensure that its authorised representatives complied with certain financial services laws when providing advice to consumers about purchasing interests in a managed investment scheme. The court had to decide whether the representatives provided personal advice within the meaning of the Act, and if so, whether they complied with the relevant sections of the Act, and whether Ultiqa took reasonable steps to ensure compliance.

The court found that the authorised representatives did provide personal advice as they made recommendations intended to influence the consumers' decisions about purchasing interests in the scheme. The court also found that the representatives did not comply with sections 961B, 961G, and 961J of the Act because they did not obtain sufficient information about the consumers' objectives, financial situation, and needs before giving advice, and they did not provide the consumers with a Statement of Advice that was tailored to the consumers' needs. The court further found that Ultiqa failed to take reasonable steps to ensure that its representatives complied with the financial services laws, and that it therefore contravened sections 961L, 912A(1)(a), and 912A(1)(ca) of the Act. ASIC was granted the declaratory relief it sought, with some modifications.

The court ordered that ASIC serve a copy of the judgment on the defendant and listed the matter for a case management hearing for further directions. The six consumers who provided affidavit evidence are Bianca Lindrea and Daniel Perkins, Sharon and Gregory Collins, Caterina and Brett Waterford, Kevin Wood and Ah-Hong Jr Ah-Hong, Christopher and Rachael Gill, and Kelly and Terrence McLean. The dates on which the consumers were given advice by Ultiqa's representatives are 10 July 2018, 12 July 2018, 5 October 2017, 6 April 2018, 11 January 2018, and 21 March 2019, respectively.