Administrative Appeals Tribunal Act 1975 (Cth) s 41

Corporations Act 2001 (Cth) ss 921C, 921E, 921ZC, 961B, 961G, 961J, 1041H

Financial Planners and Advisers Code of Ethics 2019

Australian Securities and Investments Commission v Administrative Appeals Tribunal (2009) 181 FCR 130

Australian Securities and Investments Commission v Forge [2007] NSWSC 1489

Frugtniet v Australian Securities and Investments Commission [2019] HCA 16; [2019] 266 CLR 250

McLean and Australian Securities and Investments Commission [2016] AATA 22

NW Frozen Foods Pty Ltd v Australian Competition and Consumer Commission [1996] FCA 1134

Poidevin and Australian Securities and Investments Commission [2018] AATA 124

Rent-to-Own (Aust) Pty Ltd and Australian Securities and Investments Commission [2011] AATA 68910

Schroeder and Australian Securities and Investments Commission [2020] AATA 2453

Scott and Australian Securities and Investments Commission [2009] AATA 798

Shi v Migration Agents Registration Authority [2008] HCA 31; (2008) 235 CLR 286

1. On 21 December 2023, Mr Stephen Rogers, the applicant, applied to the Tribunal seeking a review of a decision made on 1 December 2023 by the Financial Services and Credit Panel (the Panel) convened by the Australian Securities and Investments Commission (ASIC), the respondent. The Panel's decision was to issue an instrument to Mr Rogers to the effect that his relevant provider's registration under s 921ZC(1) of the Corporations Act 2001 (Cth) (the Corporations Act) be cancelled with effect from 7 December 2023 and, additionally, that he should be prevented from being registered under s 921C(1) for a period of two years (the reviewable decision). The Panel's decision operates as a de facto banning order against Mr Rogers in relation to him giving financial advice and will be referred to as such in this decision in accordance with the submissions of the parties.
2. On 12 March 2024, following the engagement of legal representatives on or about 20 February 2024, Mr Rogers applied for a stay pursuant to s 41(2) of the Administrative Appeals Tribunal Act 1975 (Cth) (the AAT Act) of the reviewable decision pending the hearing and determination of the application for review. Mr Rogers also sought an expedited hearing.
3. At the interlocutory hearing regarding the stay application, Mr Rogers' counsel submitted that the stay of the reviewable decision was appropriate principally for the following three interrelated reasons:

(a) a significant portion of the ban period would otherwise be served by the time the application for review is heard and determined; > > (b) the irreversible financial impact of the reviewable decision on Mr Rogers; and > > (c) to ensure that Mr Rogers can pay his legal fees in this proceeding.

4. Two other topics were emphasised by Mr Rogers' counsel at the interlocutory hearing which it is necessary to additionally refer to. First, Mr Rogers' counsel noted that ASIC had sought to introduce six additional instances or client files of allegedly deficient advice that were not before the Panel (the post-decision allegations), and which Mr Rogers had not had an opportunity to address. Secondly, Mr Rogers' counsel urged the Tribunal to consider whether the nature of the penalty imposed on Mr Rogers - including the two year banning period - was unjustified and manifestly excessive in his circumstances.
5. According to Mr Rogers' counsel, the Tribunal is not empowered to consider the post-decision allegations for either the stay application or the substantive review more generally due to the legislative requirements in the AAT Act and the Corporations Act that the Tribunal must confine itself to the reviewable decision. Critically, Mr Rogers' counsel submitted that the Panel had based its decision on a single client file. Furthermore, Mr Rogers' counsel argued that ASIC's attempts to refer to further client files changed the nature of the reviewable decision before the Tribunal. According to Mr Rogers' counsel, ASIC's proposal to introduce the additional client files was, therefore, impermissible. Mr Rogers' counsel relied on Frugtniet v Australian Securities and Investments Commission (2019] [2019] HCA 16; 266 CLR 250 (Frugtniet) at [15] per Kiefel CJ, Keane and Nettle JJ; Shi v Migration Agents Registration Authority [2008] HCA 31; (2008) 235 CLR 286 (Shi) at [147] per Kiefel J (with whom Crennan J relevantly agreed); and Schroeder and Australian Securities and Investments Commission [2020] AATA 2453 (Schroeder).
6. ASIC's counsel opposed the stay of the banning order. ASIC submitted that the power under s 41(2) of the AAT Act was not enlivened such that a stay was necessary to effect the statutory purpose of securing the effectiveness of the hearing and determination of the application for review. Furthermore, ASIC argued that even if the Tribunal were satisfied that the effectiveness of the hearing may be jeopardised, it was not appropriate for the Tribunal to exercise the discretion because no evidence had been provided to support the proposition that, absent a stay, the hearing would be rendered nugatory or otherwise ineffective.
7. With reference to the two additional topics raised by Mr Rogers' counsel, ASIC's counsel acknowledged that ASIC would be submitting that the Tribunal should vary the reviewable decision to increase the duration of the ban imposed by the Panel on account of the further client files which gave rise to further breaches of the Corporations Act. Nevertheless, ASIC's counsel submitted that the jurisdiction issue raised by Mr Rogers' counsel was misconceived and his reliance on the decisions in Frugtniet and Schroeder, in particular, was misplaced. ASIC's stance was that the Tribunal was being asked to consider the same question that was before the Panel as the original decision-maker. Moreover, ASIC's position was that it was entitled to add the additional client files as further evidence and that Mr Rogers was able to address the matters as part of the Tribunal proceeding in accordance with the position in Shi. ASIC argued that, in all the circumstances, the two year ban was also not excessive.
8. ASIC's counsel suggested that the interlocutory hearing regarding the stay application was, in any event, not the appropriate time to consider and determine the question of whether ASIC could rely on additional client files, although it may inform the Tribunal's consideration of the stay question.
9. As these reasons explain, I have decided that the discretion under s 41(2) of the AAT Act is enlivened and that it is desirable to grant the stay order, regardless of the jurisdiction question. The jurisdiction question should be determined separately, if necessary, after the parties have filed their respective Statements of Facts, Issues and Contentions. At the time of the interlocutory hearing, neither party had filed its Statement of Facts, Issues and Contentions.

1. The factual matters set out below are based on information extracted from the reviewable decision, the two witness statements of Mr Rogers dated 12 March 2024 and 27 March 2024, and the submissions of the parties with respect to the stay application. Mr Rogers did not give oral evidence and was not required for cross-examination by ASIC.

Mr Rogers' qualifications, financial planning experience and current employment

1. Mr Rogers has a Diploma of Financial Planning and an Advanced Diploma of Financial Planning, each from Integrity Education Group. He is currently studying a Graduate Diploma of Financial Planning at Kaplan to meet educational standards required to be attained by 1 January 2026 for existing financial advisors. He plans to complete further studies, namely, a Masters in Financial Planning.
2. Mr Rogers has been working in the financial services industry for over 10 years. This included being authorised to provide financial services on behalf of a former employer.
3. On 2 May 2022, Mr Rogers commenced employment with United Global Capital Pty Ltd (UGC) which has approximately 35 employees, 1,400 clients, its own trading team, its own funds and substantial funds under management.
4. Until the cancellation of his provider registration as a result of the Panel's decision, Mr Rogers was an authorised representative of UGC. UGC holds a financial services licence and its sole director is Mr Joel Hewish.

Advice to Ms Jarram and the relationships of relevant entities

1. In May 2022, Mr Rogers was referred a client by the name of Ms Jarram. Ms Jarram was referred to Mr Rogers (and his employer, UGC) by a company called Wealth Rite Pty Ltd (Wealth Rite).
2. Wealth Rite was previously a corporate authorised representative of UGC. Wealth Rite's process appears to have involved cold calling potential customers to obtain information about their current superannuation and to provide them with information regarding different options. Wealth Rite then went on to "book" those people who expressed interest and met relevant criteria to have further discussions with their "specialists" in regard to their superannuation, including the possibility of earning potentially higher returns through a self-managed superannuation fund (SMSF).
3. Mr Rogers stated his team leader handed him the client file of Ms Jarram which included a document tiled "Self-Managed Super Fund (SMSF) Establishment & Statement of Advice Proposal" (Proposal) signed by UGC's CEO/Chief Investment Officer. The Proposal had been earlier sent to Ms Jarram. Mr Rogers was also provided with, and followed, a script to conduct his initial call with Ms Jarram.
4. Ms Jarram had a Mercer superannuation fund and had wanted to get better performance for her superannuation balance of approximately $180,000. The Proposal stated that Ms Jarram's two intentions were, first, to set up a new SMSF so she could direct her own investment decisions and access other investments and, secondly, to engage UGC to assist her with certain services. Ms Jarram apparently did not intend to engage UGC to provide her with advice in areas relating to establishing her SMSF, rolling money from her current superannuation fund to the new SMSF, and helping her with investments.
5. On 16 May 2022, Mr Rogers completed a "Client Personal & Financial Details" document with Ms Jarram that relevantly recorded, among other things, that she had the following short-term objectives: SMSF establishment (non-investment advice); invest in Global Capital Property Fund (GCPF) and in Pivotal Diversified Fund (Pivotal); and life insurance review.
6. On 7 June 2022, Ms Jarram was provided with a "Statement of Advice" (SOA) which included Mr Rogers' recommendations that Ms Jarram retain $10,000 in her existing Mercer superannuation fund and rollover the balance into the newly established SMSF and subsequently invest 75% of her superannuation balance in GCPF and the remaining 25% in Pivotal. Ms Jarram was also recommended to arrange additional insurance cover as well as to engage UGC to handle the administration of her new SMSF.
7. The SOA contained a "benefit analysis" table which, despite purporting to exclude advice on the suitability of the SMSF and specific investments, set out a comparison between the projected 10 year performance of Ms Jarram's Mercer superannuation fund and the new SMSF with investments in GCPF and Pivotal. The product comparison and benefit analysis which were prepared by Mr Rogers in accordance with UGC's documents utilised a 13% target rate of return to investors for the new investments and, accordingly, projected a $184,080 "value add" over a 10 year period from pursuing the SMSF and investments. Mr Rogers stated that when he conducted the product comparison and benefit analysis, he had in mind the Financial Planners and Advisers Code of Ethics and his duty to act in Ms Jarram's best interests.
8. Ms Jarram proceeded on the advice in the SOA (other than the advice regarding trauma insurance cover) and rolled over most of the balance in her Mercer superannuation fund into her new SMSF and invested those funds in GCPF and Pivotal.
9. GCPF and Pivotal are related to each other and to UGC through common directorships. Broadly, GCPF receives investor funds (in exchange for ordinary shares) and invests those funds in a variety of ways in property development/projects across Australia. The directors of GCPF are Mr Dickinson, Mr Hewish and Mr Pappas.
10. Pivotal is an open-ended unlisted registered managed investment scheme that is open to retail investors. Pivotal invests a portion of funds in UGC-related financial products. The investment manager for Pivotal is Australian Funds Management Group Pty Ltd (AFMG). The directors of AFMG are also Mr Dickinson, Mr Hewish and Mr Pappas.

The Panel's decision and alleged contraventions

1. The Panel's decision was that, as a result of Ms Jarram setting up a SMSF and acting on the advice from Mr Rogers, the fees payable in respect of the administration of her superannuation funds increased considerably, from $1,700 per annum to approximately $6,800 per annum. Additionally, she paid 5.5% of her SMSF balance (approximately a total of $9,600 in upfront fees) to establish the SMSF, including a $5,214 referral fee to Wealth Rite. Furthermore, the recommended investments in GCPF and Pivotal were in highly speculative products, despite her preference for longer term growth assets. There were also complications with the insurance recommendations owing to Mr Jarram's medical history.
2. ASIC's view was that, overall, as a result of Mr Rogers' advice, Ms Jarram had been placed in a position whereby, unless the investments regularly meet their 13% targeted returns, her superannuation would be eroded by the significant increase in fees due to the establishment of the SMSF. Consequently, ASIC considered that Mr Rogers did not act in the best interests of Ms Jarram in relation to the advice given to her, contrary to s 961B(1) of the Corporations Act. This was because, amongst other things, Mr Rogers failed to identify the subject matter by purporting to limit the scope of his advice, and he failed to make adequate enquiries about Ms Jarram's needs and objectives.
3. ASIC also asserted that Mr Rogers did not give Ms Jarram advice that was appropriate to her circumstances contrary to s 961G of the Corporations Act. Furthermore, where there was a conflict between the interests of Ms Jarram and the interests of UGC, Pivotal, GCPF and Wealth Rite, Mr Rogers did not prioritise Ms Jarram's interests contrary to s 961J(1). Mr Rogers also allegedly engaged in misleading and deceptive conduct contrary to s 1041H in that he failed to acknowledge and/or appreciate the conflict arising from the fact that UGC paid Wealth Rite for its referral of Ms Jarram. Finally, ASIC claimed that Mr Rogers also did not comply with the Financial Planners and Advisors Code of Ethics 2019 contrary to s 921E(3), as he did not demonstrate or comply with the values of honesty and fairness, as well as several other standards of the Code.

ASIC's proposed reliance on additional client files with alleged deficiencies

1. ASIC acknowledged that all of the above claims before the Panel, and the Panel's decision, were based on the single client file of Ms Jarram. However, ASIC submitted that it had obtained a further six client files and had already included the relevant documents in the T-Documents. ASIC made it clear that it intended to rely on the further client files at the hearing of the application for review. ASIC was of the view the further client files demonstrated multiple and repeated breaches by Mr Rogers of the Corporations Act. Significantly, ASIC asserted that the number of breaches suggested a pattern of behaviour or business model that encouraged individuals to invest their superannuation in UGC related products without proper regard to the best interests of the clients. ASIC foreshadowed that it would also be asking the Tribunal to vary the Panel's decision to increase the length of the banning order.
2. ASIC added that contrary to Mr Rogers' position in his witness statements that he was unaware of the relationship between UGC, Wealth Rite and Pivotal, a diligent advisor would, when faced with multiple clients approaching him seeking to set up SMSFs and invest in the same products, properly turn his or her mind more carefully to why that was occurring and whether the proposed actions were in the best interests of those clients.

1. Mr Rogers was forthright and measured in his witness statements about his situation. He continues to be employed by UGC, even though he is prohibited from performing the role of a financial adviser / financial strategist for which he was employed. He understood that this was due to his employer's good grace, in particular, the support of Mr Hewish, and because he also had transferable skills as a business development manager.
2. Mr Rogers earns a base salary and is entitled to performance-based payments. Following the Panel's decision, UGC pays him only his base salary and there is no prospect of him presently earning commissions. Mr Rogers recounted that the direct and immediate financial impact on him was that his earnings fell by approximately $7,000 per month after the Panel's decision. However, according to Mr Rogers, the true and ongoing impact was more significant as he had only recently built a client base of critical mass from which he expected to earn commissions, up to approximately $15,000 per month.
3. The Panel's decision would also lead to him suffering a permanent loss of clients from the damage to his reputation. He considered this to be devastating, particularly as he had invested considerable efforts in his financial planning career, including by committing to further studies. Mr Rogers stated that at ASIC's insistence, UGC had already notified his clients of the Panel's decision and that had caused him to be physically ill, and the process generally had also caused him mental anguish and stress.
4. Mr Rogers also referenced his family circumstances. He has a wife and two teenage children. He acknowledged that his wife was working full-time and that he also was able to continue to work with UGC, albeit at a reduced level of income. He accepted their household income was sufficient to meet their basic needs and he provided details of their expenses. He stated that he was not wealthy and did not lead a lavish lifestyle.
5. Mr Rogers stated any unexpected expenses would cause him to go into further debt. Relevantly, Mr Rogers explained that UGC was paying the estimated legal costs of his stay application, but that the legal costs of the substantive hearing were still the subject of an ongoing dialogue with UGC. In this regard, it is also noted that UGC's lawyer had initially assisted Mr Rogers with responding to the Panel's Proposed Action Notice, being the only interaction that Mr Rogers had ever had with ASIC prior to the Panel's decision. UGC's lawyer later refrained from providing any advice to Mr Rogers on account of a potential conflict of interest between UGC and Mr Rogers. As stated above, Mr Rogers did not receive independent legal advice until about 20 February 2024.
6. Mr Rogers also stated that he relied on and followed UGC's procedures when he gave the scoped advice to Ms Jarram. Mr Rogers stated that if he had known there were legal, regulatory or compliance issues or concerns with the scoped advice he gave to Ms Jarram, he would not have given that advice. Mr Rogers recalled that in June 2023, UGC mandated all its advisers were to no longer give scoped advice of the kind that he gave to Ms Jarram and, therefore, that particular business model had ceased. Mr Rogers additionally proffered an undertaking, for completeness, to the effect that if the Panel's decision was stayed, he would not give scoped advice for the duration of the stay.

RELEVANT STATUTORY PROVISIONS AND PRINCIPLES REGARDING STAYS

1. Broadly, the making of an application for review to the Tribunal does not affect the operation of the decision under review. Subsection 41(1) of the AAT Act provides:

Subject to this section, the making of an application to the Tribunal for a review of a decision does not affect the operation of the decision or prevent the taking of action to implement the decision.

2. That position is, however, subject to the Tribunal's power to make orders staying or otherwise affecting the operation or implementation of the decision under review found in s 41(2) of the AAT Act which provides:

The Tribunal may, on request being made, as prescribed, by a party to a proceeding before the Tribunal (in this section referred to as the relevant proceeding), if the Tribunal is of the opinion that it is desirable to do so after taking into account the interests of any persons who may be affected by the review, make such order or orders staying or otherwise affecting the operation or implementation of the decision to which the relevant proceeding relates or a part of that decision as the Tribunal considers appropriate for the purpose of securing the effectiveness of the hearing and determination of the application for review.

3. The statutory language of the stay power in s 41(2) of the AAT Act makes clear the power to order a stay is only available "for the purpose of securing the effectiveness of the hearing and determination of the application for review". The statutory language contemplates the Tribunal deciding whether the exercise of power is "desirable" having regard to "the interests of any persons who may be affected by the review". The interests in turn must be decided by reference to the statutory scheme under which the original decision was made: Australian Securities and Investments Commission v Administrative Appeals Tribunal (2009) 181 FCR 130 at [51]-[54] and [56]-[57].
4. In determining whether a stay is appropriate, there are numerous authorities that establish that the Tribunal may consider a range of factors. These factors include (1) the prospects of success; (2) the consequences for the applicant of the refusal of a stay; (3) the public interest; (4) the consequences for the respondent in carrying out its functions depending upon whether a stay is granted or not; (5) whether the application for review would be rendered nugatory if a stay were not granted; and (6) other relevant matters, such as the length of time that the ban has already been in place and the gap between the stay application and the hearing of the review: see Scott and Australian Securities and Investments Commission [2009] AATA 798 (Scott) at [4].
5. A stay may also be made subject to conditions as set out in s 41(6)(a) of the AAT Act.

1. I turn now to a consideration of the key relevant factors and submissions made for and against the grant of the stay order in accordance with the Scott decision. Mr Rogers argued that the underlying facts indicated that he has strong prospects of success. This was because the reviewable decision was entirely based on a single instance of purported advice that was scoped expressly, given in good faith by Mr Rogers and understood by Ms Jarram to exclude the advice that ASIC determined contravened financial services laws. Moreover, the advice was given in the first few weeks of Mr Rogers' employment with UGC, when Mr Rogers claimed to be unaware of the relationship between Wealth Rite, being the referrer of the client, and UGC.
2. Mr Rogers further submitted that ASIC had also proceeded on unfounded assumptions and, therefore, overreached in effectively banning him from giving financial advice for two years having regard to the authorities and all the circumstances of an isolated incident. This was especially the case where personal and general deterrence are the central factors in the making of a banning order: see NW Frozen Foods Pty Ltd v Australian Competition and Consumer Commission [1996] FCA 1134 at [15]- [16] per Burchett and Kiefel JJ.
3. ASIC accepted that Mr Rogers' application for review is not frivolous but argued that it was not, however, a strong case which weighs in favour of granting a stay. ASIC submitted that irrespective of the disclaimers in the advices, the Panel reasonably believed that Mr Rogers had recommended to Ms Jarram (and other additional clients) to establish a SMSF and to make the particular investments and, in doing so, had not acted in the best interests of Ms Jarram and other additional clients.
4. ASIC also argued that if Mr Rogers had only been providing the scoped advice, he would not have needed to provide the SOA, or one which contained the benefit analysis. ASIC surmised that the SOA was designed to encourage Ms Jarram (and other clients) to set up a SMSF and make the recommended investments. ASIC submitted that in addressing matters beyond the identified scope of the engagement, Mr Rogers had failed to properly provide the advice by bringing his own independent assessment and judgment as to whether the establishment of the SMSF and the specific investments were in Ms Jarram's best interests and met her needs and objectives. Furthermore, Mr Rogers had engaged in misleading and deceptive conduct and breached various ethical standards.
5. It is well established that it is not the role of the Tribunal to conduct a preliminary hearing of the review application when considering an applicant's prospects of success: Poidevin and Australian Securities and Investments Commission [2018] AATA 124 at [39]- [40]. It is relevant, however, for the Tribunal to examine whether, in light of the evidence before it, the applicant's prospects of success are sufficiently high to justify the grant of a stay. This is because if an applicant has strong prospects, a stay is more likely to be granted. The difficulty in an evaluation of Mr Rogers' prospects, at this stage, is that there are numerous disputed facts. In this regard, it is noted that the Panel did not interview Mr Rogers at any stage and, until the filing of the T-Documents on or about 16 February 2024, there was only ever one client file with alleged contraventions which Mr Rogers had to address. Mr Rogers' counsel separately stated that, before the Panel, Mr Rogers was self-represented, whereas now that independent legal advice had been obtained by Mr Rogers, additional arguments would be advanced regarding, amongst other things, the legal parameters of the best interest obligations. As stated above, neither party had filed its Statement of Facts, Issues and Contentions to articulate their positions. Finally, there is uncertainty about the further client files and the details of the alleged multiple and repeated contraventions of the Corporations Act. All that can be said about Mr Rogers' prospects at this stage of the proceeding is that his situation is not hopeless. In the circumstances, this factor is neutral as regards the stay question.
6. Mr Rogers gave a straightforward and frank assessment of the consequences of the refusal of a stay for him of the Panel's decision, including the detrimental financial consequences to his family and the fact of his reputational damage. I accept that Mr Rogers would suffer ongoing and permanent financial losses while the reviewable decision remained in force and, even if he were successful on the substantive review, he would not be able to recover his lost income.
7. ASIC submitted that the financial implications were not catastrophic which may also be readily accepted as Mr Rogers continues to work, albeit he earns a reduced income. His wife also has full-time employment. I am also mindful that prejudice or hardship to an applicant is "hardly ever a sufficient basis for securing a stay": McLean and Australian Securities and Investments Commission [2016] AATA 22 at [21]- [22]. ASIC further pointed out that the possibility of regulatory action in the public interest (and all the consequences which flow with it) is an inherent risk of participation in a regulated industry: Australian Securities and Investments Commission v Administrative Appeals Tribunal (2009) 181 FCR 130 at [76] per Downes and Jagot JJ.
8. Notwithstanding, the practical reality is that the longer the Panel's decision remains in force before the hearing and determination of his application for review, the longer it would take Mr Rogers to regrow his client base and to earn commissions again. Moreover, the financial impacts on Mr Rogers' household finances are such that there is a significant risk, if UGC does not fund Mr Rogers' legal costs of pursuing the application for review, that he will be unable to pursue his application for review. Furthermore, there is a potentially significant conflict of interest between Mr Rogers and his employer which may lead to UGC and Mr Rogers not cooperating and UGC not giving him any financial assistance for the final hearing. Interestingly, it was submitted by Mr Rogers' counsel that Mr Rogers' role was insignificant and he was in a position where he was taken advantage of. Accordingly, the consequences for Mr Rogers and his family of the refusal of a stay weigh slightly in favour of granting a stay.
9. As to the public interest considerations, Mr Rogers' counsel pointed out that accessibility and affordability of financial advice have remained a clear and consistent objective of Australia's recent financial services law reforms and that scoped (or scaled or limited) advice has been actively encouraged by the Government and ASIC. This was in order to promote access and affordability to the public of quality financial advice. Against that background, Mr Rogers' counsel argued that ASIC's approach of refusing to grant a stay in circumstances where the underlying decision may be set aside results in permanently and irreversibly penalising an adviser for simply giving scoped advice and risks undermining the objectives regarding the provision of scoped advice generally.
10. On the other hand, ASIC emphasised the public interest having regard to the objects of the regulated industry, especially the fact that the concerns raised were with respect to Mr Rogers' advice on an individual's superannuation. ASIC submitted the public interest factor should be the primary consideration in determining the desirability or otherwise of a stay being granted because "the central consideration remains...good regulation and good administration": Rent-to-Own (Aust) Pty Ltd and Australian Securities and Investments Commission [2011] AATA 689 at [47].
11. ASIC's position is that the conduct of Mr Rogers indicates that UGC operates a particular business model in which clients are referred to UGC by Wealth Rite, and they are then provided with what is described as "scaled" advice but which in essence encourages them to set up a SMSF, roll over their existing superannuation and then invest in UGC related products, without Mr Rogers as the adviser appropriately conducting a full and independent assessment as to whether that approach is in the best interests of the client. Understandably, ASIC stated that is especially concerning in circumstances where clients were at risk of losing their lifetime superannuation savings in speculative or highly speculative products.
12. ASIC added that it did not appear Mr Rogers had expressed any remorse or insight into his conduct as he stated in his witness statements that he had acted on his employer's instructions and his advice was in the best interests of Ms Jarram. ASIC also stated it could not be satisfied that Mr Rogers would behave any differently even though he proffered an undertaking to not give financial advice of that nature and UGC was no longer operating that business model.
13. I accept that the public interest is an important factor, and that banning orders also have been recognised as having a deterrent purpose not only against the recipient of the order, as in protecting the public against any misconduct of a particular person, but as a general deterrent in respect of others involved in the industry to signal the serious consequences which will ensue if they breach their duties: Australian Securities and Investments Commission v Forge [2007] NSWSC 1489 at [103]. This factor favours the refusal of the stay order even though I accept that Mr Rogers is no longer engaged in giving scoped advice.
14. It is accepted that the grant of a stay would not have any particularly adverse effect or consequences for ASIC in carrying out its regulatory function. This is notwithstanding there is a public interest in ASIC's decisions generally being implemented immediately and those charged with regulation being seen to be fulfilling their role: Scott at [10]. Self-evidently, the grant of a stay in an appropriate case is part of the review process and is specifically provided for in the AAT Act. This issue is therefore a neutral factor in balancing the considerations for and against the grant of a stay.
15. Mr Rogers argued there is a real prospect the review could be rendered nugatory if a stay is not granted. This goes to the heart of whether the stay should be granted in the present case to secure the effectiveness of the hearing and determination of the application for review. The relevant chronology of events and the likely timetable for the hearing is, as follows.
16. The Panel's decision was made on 1 December 2023 and took effect on 7 December 2023. On 21 December 2023, Mr Rogers lodged the application for review with the Tribunal.
17. On or about 20 February 2024, Mr Rogers engaged independent lawyers following discussions with UGC's lawyer that there may be a conflict of interest. The lawyers for Mr Rogers notified ASIC of his intention to request the Tribunal to stay the reviewable decision on 22 February 2024. ASIC indicated it would oppose his request. The parties were not able to agree to a timetable for the stay hearing nor for the hearing and determination of the review.
18. On 26 February 2024, the first case management directions hearing was listed before Deputy President McCabe who, relevantly, made directions about any stay application and for the filing of hearing certificates for the substantive hearing in respect of the months June, July, August and September 2024. Just prior to that first case management directions hearing, ASIC had informed Mr Rogers' lawyers about the post-decision allegations and the fact that information about those further client files had been included in the T-Documents. ASIC also raised the post-decision allegations at the first case management directions hearing and offered to file its Statement of Facts, Issues and Contentions before Mr Rogers.
19. As stated above, on 12 March 2024, Mr Rogers applied for a stay. On 17 April 2024, at the end of the interlocutory hearing regarding the stay application, the Tribunal varied the abovementioned direction and directed the parties to file hearing certificates for the substantive hearing in respect of the months July, August and September 2024 by 31 May 2024. The Tribunal also directed the parties to attend a conciliation in June 2024. Consequently, assuming the substantive hearing is listed in or about August 2024 and the Tribunal reasonably takes at least one month after hearing the application for review to make its decision, the ban will have been in effect for approximately ten months and may potentially be in effect for much longer. In Scott, Downes J recognised that a successful review application "would be rendered less useful" if a stay was not granted. While his Honour declined to grant a stay in Scott, the "definitive matter" leading to that decision was the very short period of time that had elapsed since the banning order under review was made (two months) and the very short period of time before the substantive application was to be heard (six weeks). His Honour considered that, as the member who hears the application would be in a better position to assess the merits of a stay and given the short period of time to that hearing, the prejudice to the applicant was "insubstantial". Plainly, the same is not the case here because some five months have already passed since the banning order was made, and the likelihood is that some ten months will have passed before the application for review is heard and decided.
20. I agree that, in all the circumstances, the stay power is enlivened and, furthermore, that a stay order is appropriate, balancing all the competing considerations. The factor that weighs most strongly in favour of the stay is the realistic prospect that a substantial part of the period of cancellation will likely have been served by the time the hearing and determination of the application for review is finalised. Mr Rogers' counsel pointed out that the operating assumption of the parties to date was that Mr Rogers would suffer a ban of approximately ten months out of the current two year banning period. However, if a further interlocutory process to determine the Tribunal's jurisdiction was necessary, the period before a Tribunal decision on the application for review may be longer, possibly over half the actual banning period. Even if an interlocutory hearing is not required and the jurisdiction question regarding the post-decision allegations is addressed at the final hearing, Mr Rogers will have to canvass more information and documents in relation to further client files. The Tribunal will also be required to make its decision on information and documents that were not before the Panel in relation to those further client files which may take further time.
21. It follows that if a stay is not granted and Mr Rogers is ultimately successful, Mr Rogers will have suffered some irreversible financial harm as well as reputational damage. More significantly, a substantial part of the period of cancellation will likely have been served by the time the hearing and determination of the application for review is finalised.

1. I was persuaded that a stay is required "for the purpose of securing the effectiveness of the hearing and determination of the application for review" under s 41(2) of the AAT Act. That is, the discretion was enlivened and, furthermore, it is desirable in all the circumstances after balancing the competing considerations to exercise the discretion to grant a stay order on the condition that Mr Rogers does not provide scoped advice for the duration of the stay period.

I certify that the preceding 62 (sixty-two) paragraphs are a true copy of the reasons for the decision herein of Senior Member G Lazanas

...................[SGD]..............................

Mr R Chiarella, Australian Securities and Investment Commission