Former Storm Financial adviser and ex-rugby league player Wally Fullerton-Smith handed permanent ASIC ban

Former Australian rugby league player and Storm Financial adviser Walter John (Wally) Fullerton-Smith of Carrara has been permanently banned by ASIC from providing any financial services after it found he had engaged in misleading and deceptive conduct and failed to comply with financial services laws.

This included breaching the 'client/planner' relationship by placing investment funds from an elderly couple aged in their 80s in a trust of which he was the trustee and one of the beneficiaries while knowing they stood to lose their entire investment.

Fullerton-Smith also did not pass on to his elderly clients $60,051 paid to him in error by the Commonwealth Bank as a settlement under the CBA Storm Resolution Scheme.

Fullerton-Smith, a former Queensland and Australian rugby league player of the 1980s and 1990s, was adviser with Storm Financial Ltd between May 2006 and June 2009 and is currently an authorised representative with AAA Financial Intelligence Ltd.

He played for the St George Dragons from 1987 and 1992, played 12 State of Origin games for Queensland and eight tests for Australia.

An ASIC investigation of Fullerton-Smith found that between November 20, 2007 and December 10, 2010 failed to comply with financial services laws.

ASIC found that he engaged in misleading or deceptive conduct or conduct likely to mislead or deceive when procuring the elderly couple’s units in an MLC MasterKey Unit Trust as security for the trust margin loan account.

“It was implied the investment would be safe. This was false and a misrepresentation of the risks," said ASIC.

"ASIC considers Mr Fullerton-Smith’s conduct to be very serious. He has not maintained the high standards expected of a provider of financial services in that he put his personal interests ahead of those of his clients and as a result caused them severe financial detriment," said ASIC commissioner Peter Kell.

Fullerton-Smith has the right to appeal to the Administrative Appeals Tribunal to seek a review of ASIC’s decision.

ASIC estimates the total loss suffered by all investors who borrowed monies from banks to invest through Storm to be approximately $830 million.

It has been investigating a range of issues relating to the affairs of Storm Financial Limited since December 2008.

In September, the Commonwealth Bank reached a resolution with ASIC in relation to the Storm Financial matter, that will see the bank compensate investors around 55% of their losses.

ASIC 's case against the other banks involved in Storm Financial margin lending, Bank of Queensland and Macquarie Bank, is still ongoing.