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GEMI Investments Class Action GEMI Investments Class Action GEMI Investments Class Action

Negligent Financial Advice


Financial advisers and financial institutions are in the spotlight.

Despite the conclusion of the Hayne Royal Commission, you are likely to keep seeing more about the topic of financial planner wrongdoing in the press.

If you’ve received bad financial advice from a financial adviser, financial planner or stockbroker, we can help you to find the compensation you need to make it right. MC Lawyers has assisted clients recover millions of dollars through courts and tribunals.

The scandals which continue being uncovered in the financial sector are indicative of widespread and systemic failure. This failure exists as a result of the often times perverse and conflicted compensation incentives within the industry. Time and again, these incentives have been shown to drive “bonus chasing” behaviour at the expense of clients’ best interests. 

Receiving poor financial advice can have devastating consequences. Successfully challenging your financial adviser is typically a stressful and time consuming process, to say nothing of the complexity and jargon employed by financial institutions in their efforts to defend their conduct and avoid paying compensation.

We’ve helped many retirees recover their life savings in circumstances where they were advised to invest in high risk, speculative investments whose primary purpose was to pay high commissions to the financial planners making the recommendation.

Common scenarios which give rise to financial adviser negligence include:

  • Recommending unreasonably risky investments – particularly if you have a preference for low-risk conservative investments and are placed into high-risk investments, you may have a claim against your adviser for failing to act in your best interests;
  • Recommending an inadequately diversified investment portfolio – this can occur when you are placed into investments which concentrate too much of your wealth with one organisation, industry or sector. This failure to spread the risk of your portfolio is a regular feature of claims in negligence;
  • Failure to ascertain your personal circumstances and priorities – a financial adviser must know about your income, assets, liabilities and risk appetite before he or she can provide you with informed advice. Failure to do so creates an inference of negligence;
  • Misleading and deceptive statements – an adviser who misleads you orally or in writing about the characteristics of an investment product may be guilty of negligence. Investments being described as “risk-free” or “guaranteed” are typical misleading statements;
  • Failing to provide you with a Statement of Advice, Financial Services Guide or Product Disclosure Statement – providing these documents to you is a statutory requirement. Failure to meet this statutory requirement creates an inference of negligence; and
  • Failure to justify switching your investments – advisers are required to evaluate the costs and benefits to you of your current investments against alternative investment settings, particularly with respect to cost and risk. It is appropriate to recommend a switch in investments or “wrap” platform only if such a switch results in lower costs or an improvement in your portfolio risk profile. All too often such switching recommendations are motivated by fees and commission payable to the financial adviser rather than a client’s best interests.

If you have relied on a financial planner, financial adviser, or stockbroker and suffered loss as a result of their advice, we encourage you to contact us for a confidential no obligation assessment of your claim.

Time limits apply for many financial advice dispute claims. We are experts in the area of financial services law. We will make this process simple for you by providing you with timely and clear advice, by firstly advising you whether you have a legal claim, and then by determining your best course of action.

MC Lawyers can act for you on a no win, no fee basis. This means you only have to pay our legal fees if your case is successful. 


Pricing Options

We believe in offering our clients flexible and transparent pricing arrangements to suit their preferences and commercial imperatives.

Depending upon the matter, we can offer you the following pricing options:

1. Hourly rate pricing: this is the legal industry standard method of billing. The amount of time spent working on a matter is the amount that will be billed, irrespective of outcome or value to the client. This option works best where there is a relationship of trust in which the scope of work is difficult to accurately price.

2. Fixed fee: this is an arrangement for the completion of defined piece of work at a fixed cost. This option gives the client cost certainty in terms of cost. This type of pricing is most suitable for reasonably simple matters lacking any unpredictable variables (e.g. a conveyance).

3. Capped fee: a capped fee is similar to the hourly pricing arrangement except the client stops paying after a certain “cap”. This provides costs certainty to the client as they will know the maximum amount that they will be liable to pay, with the possibility of a lower amount being payable if the work is completed more efficiently than the cap allows. This arrangement is generally suitable for medium complexity work with a limited number of material variables.

4. Risk sharing arrangement: an arrangement whereby the law firm agrees to receive only a proportion of its professional fees billed with the balance payable on the successful conclusion of your matter. Disbursements are typically payable paid in full. This type of arrangement typically works well in complex large-scale litigation such as class actions.

5. Monthly retainer: this arrangement requires the client to pay a fixed amount every month in return for services which have a reasonably predictable steady flow. This is usually suitable for regular low complexity work with few to no variables.


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