Alec Khoo, of Adelaide, South Australia, has been banned from providing financial services for three years, after he was found to have offered unsound advice to clients, resulting in a “significant” loss on their investments. 

The central issue identified by the ASIC, was Khoo’s direction of his clients to borrow money through a marginal lending facility, and then to invest the borrowed funds into a three-year cash investment. This resulted in his clients making losses, as the interest paid on the borrowed funds was higher than the interest earned on the cash investments.
 
The ASIC found that Khoo failed to have a “reasonable basis for [the] advice”.
 
Several allegations have been lodged against the ex-financial advisor; the failure to include mandatory information on marginal lending in statements of advice; the failure to provide statements to clients when legally required to do so; and the provision of advice to a client that contained information “that was likely to mislead”.
 
Khoo was an authorised representative of Professional Investment Services and provided financial advice to clients of his business known as Alec Khoo & Associates.
 
In an unrelated event, ASIC have also moved to ban Apple Investment Company, of Queensland, from providing financial services for five years. It was found that Apple had made both false and misleading statements to clients about their services.
 
ASIC commissioner, Peter Kell said Apple Investment Company showed blatant disregard for financial services laws and specifically, the requirement to provide accurate information to consumers.

"ASIC wants investors to participate in the financial system with confidence. The provision of misleading information to clients by Apple erodes this confidence so it is important that Apple be removed from the financial services industry for the next five years," he added.