SMSF Property Capital pays penalty over 'ASIC approved' statements

A $10,200 penalty has been paid by SMSF Property Capital Pty Ltd, to comply with an infringement notice from ASIC, after the company presented potentially misleading statements referring to 'ASIC approved' financial products.

The payment of the notice is not taken as an admission of liability.

Deputy chairman for ASIC, Peter Kell, said that this should be taken as a warning to anyone advertising financial products.

"It is crucial that consumers are not misled about the level of risk associated with any investment," Kell said.

"ASIC takes the misuse of language such as 'ASIC endorsed' or 'ASIC approved' very seriously, especially in the area of SMSFs. Creating a false impression of the level of regulatory approval for investments can lead to consumers making poor decisions," he said.

Queensland-based SMSF Property Capital had acted quickly to remove the statements from its website after ASIC approached them.

The representations included in the infringment notice were said to include the following on webpage around August 2013.

"SMSF Property Advisers has a pipeline of management property investments through Australian Securities and Investments Commission approved schemes."

"By partnering with many other SMSF investors in an ASIC approved managed fund our clients receive the significant benefits of a development project achieved without carrying any bank debt."

"Using an Australian Securities and Investments Commission (ASIC) approved structure, we give our clients access to developer profit margins, relatively short turn-around investment returns, and developments without debt."

If SMSF Property Capital did not comply with the ASIC infringement notice, they may have had to pay up to $1.7 million maximum for the alleged contravention.

Online advertising has been a focus of ASIC lately, with Mortgage Choice recently being fined and MyRate similarly responding to ASIC concerns.

Jennifer Duke

Jennifer Duke

Jennifer Duke was a property writer at Property Observer

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