No action against big banks
ASIC alleges between September 2017 and January 2018, Port Phillip published an article that contained false testimonials and the promoted investment strategy could not have mimicked the performance of the Future Fund.
The article was emailed to 120,000 subscribers and at least 833 people paid $49 to receive the guide and sign up to an annual subscription to Port Phillip’s newsletter service. Most of them were retired, or approaching retirement.
Mr Sayce said in a statement the company disagreed with the allegations and would defend its position in the Federal Court.
“In an environment where the major banks and fund managers have been raked over the coals for charging customers a total of millions of dollars for services they didn’t receive, and where the banks have admitted to unconscionable conduct, due in part to their dominant market positions, it’s extraordinary that the proposed penalty is to seek to close our business, put 70 staff members out of work, and deny our 50,000 subscribers the benefit of our advice,” he said.
He said ASIC was proposing to close the entire business over a campaign that allegedly raised $40,000 in revenue.
“I am unaware of any instance where regulators have sought to shut down one of the big banks or funds-management businesses when they have faced similar accusations. If that happens, such action would only result in consolidating the Australian financial services even more into the hands of the big banks and fund managers,” he said.
ASIC faced similar criticism from the founder of now-collapsed Dover Financial Advisers, Terry McMaster, who accused the regulator of having one set of rules for the big end of town and another set for others.
The court action taken by the regulator is in contrast to the last time Port Phillip had a run in with the regulator.
In 2016, the publishing house was pinged by the regulator for claiming on its website Australians would not be able to access their retirement savings because the government was going to nationalise superannuation.
The website went on to encourage readers to protect their superannuation from being stolen by subscribing to Port Phillip’s online newsletter.
Port Phillip paid a $21,600 fine without admitting breaches of the law.
In addition, in May last year, IT consultant Steven Richard Oakes was charged with illegally accessing unpublished stock reports from Port Phillip to engage in insider trading.
Oakes has pleaded guilty to eight charges of insider trading. His plea hearing will be held on March 15.