An insurance broker banned for life from providing financial services after he gambled away $414,655 in clients’ premiums has lost his bid to cut the duration and scope of the penalty. 

Sean Sweeney, the sole director of Sweeney Insurance Services and later Swinsure, admitted eight counts of fraud in 2022. He was sentenced to jail terms on all charges but was allowed to serve community service. 

The Australian Securities and Investments Commission then imposed a permanent ban preventing him from providing, or being involved in the provision, of financial services.

Mr Sweeney challenged the ban at the Administrative Appeals Tribunal, which issued a ruling last week. 

Tribunal Deputy President Bernard McCabe says he considered allowing Mr Sweeney to work in the insurance industry again, but “decided that is not the correct course”.  

A long ban “might be an effective way of communicating a lesson to other participants in the industry”, he says. 

“The message would be diluted if I were to reduce the scope of the ban. A clear message is needed to achieve a deterrent effect.” 

Mr McCabe says the ban will reassure consumers “fraud and dishonest conduct is policed and punished”.

The fraud was “blatant and relatively serious” and occurred while doing “the very work the applicant would like to be able to resume”. 

“The nature and timing of the convictions are such that ... the applicant is not a fit and proper person to undertake the regulated activity,” Mr McCabe said. 

Mr Sweeney arranged premium funding for eight client accounts, but the customer advances were deposited into his personal account. About $100,000 has been returned to the premium funder so far. 

A psychologist said Mr Sweeney had a long history of drug and alcohol use and when under that influence “is at an increased risk of engaging in impulsive behaviours including problematic gambling”.

Mr McCabe said: “I understand Mr Sweeney’s drug of choice was cocaine, which means he inevitably engaged in unlawful behaviour when he obtained those drugs. It is clear to me that the offending was serious. It was not a sophisticated fraud and it was detected relatively easily.”

Mr Sweeney appears “genuinely contrite ... so that he is unlikely to offend again” and has good faith towards restitution, but the offences “remain an insuperable obstacle”.

The former broker has attended therapy for gambling and has abstained from drugs and alcohol.

“While that is encouraging, it is clear the risk of relapse can never be entirely eliminated,” Mr McCabe said. “Addictions might resurface if the applicant were to slacken his commitment to sobriety.”

Misappropriation of clients’ funds and fraud would “tend to suggest a longer ban of 10-12 years or a permanent ban is appropriate”, the ruling says.

See the ruling here.

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