An ex-employee of the financial planning company NSG Services has alleged that the business used teachings based on Scientology as part of their staff training.
The Melbourne-based company (formerly National Sterling Group Pty Ltd) has also allegedly failed to provide appropriate training to its advisers to ensure clients receive advice in their best interests, according to the Australian Securities and Investments Commission (ASIC).
Moreover, ASIC contends that NSG trained its advisers that it is almost always in a client's best interest to take out some form of life risk insurance, regardless of a client's financial situation.
The former NSG trainee Dylan Romano was quoted as saying by Fairfax Media that “the facilitator told us the training was based on the teachings of Scientology founder L. Ron Hubbard but that the business wasn't associated with Scientology, it just liked the philosophy”.
"I definitely felt like we were being trained as salespeople rather than financial advisers, and I was very uncomfortable with that," he told Fairfax Media.
"It was very much about learning how to deal with outside influences and get things back on track. A lot of behavioural stuff, like how to mirror people and act like a counsellor to get them over the line."
Romano was a trainee at NSG for a few months in 2015, but ended up leaving the company because he was not happy with the high-pressure selling tactics.
ASIC recently commenced proceedings against NSG for alleged breaches of the 'best interests duty' introduced under the ‘Future of Financial Advice’ (FOFA) reforms.
It is the first civil penalty action ASIC has taken against a licensee alleging breaches of the best interests duty and the watchdog is looking for declarations of breaches and financial penalties.
Among other things, ASIC is alleging that NSG failed to take reasonable steps to ensure that its advisers complied with the best interests obligation when providing advice to clients. Consequently, “on numerous occasions, NSG advisers did not act in the best interests of their clients”.
L&D Professional contacted NSG for comment.