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ASIC cancels Financial Circle licences

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The Australian Securities and Investments Commission has cancelled advice group Financial Circle’s financial and credit licences.

Financial Circle was fined nearly $9 million last month and banned from the industry for breaching multiple financial services, credit and consumer protection laws.

It offered clients personal loans of up to $5000 if they agreed to buy personal insurance products and switch superannuation providers. The company received commissions from the insurers and significant advice fees that were paid directly from the clients’ super accounts.

Up to 30% of clients’ super balances were eroded in some instances.

The regulator says Financial Circle’s authorised representatives breached client best-interests obligations and appropriate advice obligations, and engaged in credit activity without a licence.