The first “best-interests” case has been instigated by the Australian Securities and Investments Commission (ASIC), against Melbourne-based adviser group NSG Services.

The action names two former NSG advisers – Mustafa Ozak and Van Trinh – and alleges they failed to comply with the best-interests obligation of the Corporations Act when giving advice.

ASIC also alleges NSG did not provide appropriate training for its advisers to ensure they acted in clients’ best interests.

Alleged failures include always selling life insurance regardless of clients’ financial situations.

It is also alleged that since July 1 2013, on eight occasions NSG advisers sold costly, unsuitable and unnecessary insurance products to clients.

ASIC says NSG’s written compliance procedures were inadequate and not followed or enforced. There was also a lack of adviser reviews or disciplinary action against advisers who breached their obligations under the Corporations Act, it is claimed.

The action has been listed in the Federal Court in Melbourne, with the first hearing scheduled for July 8.