A Melbourne advice business has been fined nearly $9 million for breaching multiple financial services, credit and consumer protection laws.

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

This resulted in cases where up to 30% of clients’ superannuation balances were eroded.

The Federal Court found Financial Circle made false and misleading representations and engaged in misleading and deceptive conduct and unconscionable conduct.

It also breached obligations under its financial services licence, including ensuring authorised representatives act in their clients’ best interests and provide appropriate advice.

Financial Circle also engaged in credit activity without a licence.

The company has been banned from the financial services industry and ordered to pay the corporate regulator’s court costs.