The first variation was the reduction of the period and scope of the banning imposed on former Melbourne-based financial adviser Ashok Sherwal.
Mr Sherwal was originally banned on 11 June 2021 from providing financial services and performing any function in a financial services business for a period of six years (21-278MR). The AAT reduced the period of the banning to five years and reduced the scope of the banning to the provision of financial services and the performance of any function as an officer or manager of an entity carrying on a financial services business.
The AAT delivered its decision on 7 December 2022, following Mr Sherwal’s application for review. The AAT found that Mr Sherwal failed to act in his client’s best interests in advising them to place new superannuation-funded insurance as part of their participation in a cash rebate procedure. The AAT found that Mr Sherwal failed to prioritise his client’s interests in the advice he gave and that there were instances of inappropriate advice and failures to comply with the additional requirements of advice, which recommended the replacement of one product with another.
In reducing the period and the scope of the banning, the AAT formed the view that some aspects of ASIC’s decision reasoning were misconceived and that the cash rebate procedure was not itself unlawful. The AAT found that Mr Sherwal demonstrated that he is a “proper” person to be permitted to provide financial services, however had failed to discharge his basic obligations, and had demonstrated a lack of reliable care and attention in the consideration of his client’s affairs.
In the second case, the AAT set aside a decision by ASIC to ban Paul Ernest Dortkamp from performing functions as an officer and responsible manager of a financial services business.
Mr Dortkamp of Caringbah South, NSW, formerly a director, chairman and responsible manager of Spaceship Capital Limited, was banned by ASIC on 2 June 2022 for a period of two years.
On 20 December 2022, the AAT delivered its decision on his application for review of ASIC’s decision. Deputy president Rayment OAM KC concluded that, based on the evidence at the AAT hearing, he was not satisfied that Mr Dortkamp failed to act, did not understand the financial services that his company was providing, or is incompetent.
