The Australian Securities and Investments Commission (ASIC) has settled Federal Court class actions against two Melbourne-based financial services firms over advice given to investors in collapsed investment company Westpoint.

The class actions against Bongiorno Financial Advisors Pty Ltd and Bongiorno Financial Advisors (Aust) Ltd relate to a claim for compensation for financial advice given by the companies that recommended clients invest in York Street Mezzanine, a company within the failed Westpoint Group.

ASIC launched legal action against the companies between December 2007 and February last year, alleging that the companies were negligent, engaged in misleading and deceptive conduct and breached conditions of their Australian financial services licences in providing advice.

Once it receives court approval, the case will be the third settlement ASIC has reached on behalf of Westpoint investors against an Australian financial services licensee.

In September, the regulator reached a settlement allowing the clients of Professional Investment Services to recoup some of their investment in the collapsed property group. And in November last year it secured a confidential settlement on behalf of investors against Masu Financial Management.