Affected clients of Mercer Financial Advice (MFA) paid over $14 million in inappropriate ongoing fees, as court documents show ASIC had pushed for a penalty of $20 million.
Last week, MFA was ordered by the Federal Court to pay $12 million for fees for no service and failures in its fee disclosure obligations.
Justice Timothy McEvoy said MFA failed to provide fee disclosure statements to certain retail clients. Other retail clients received fee disclosure statements that were deficient in that they failed to adequately disclose and were misleading as to significant financial services to which the client had been entitled but had not used.
Affected clients suffered $14,465,343 in inappropriate ongoing fees.
Mercer was found to have breached sections of both the Corporations Act and ASIC Act over a three-year period from 1 July 2016 to 30 June 2019 when it:
- Failed to invite more than 800 clients to attend annual review meetings, despite those clients being entitled to attend the meetings.
- Failed to provide fee disclosure statements to over 500 clients.
- Issued over 3,000 non-compliant fee disclosure statements to more than 2,000 clients.
- Charged 761 clients a combined total of more than…
