❓ Mr. Kobelke raises concerns about unregulated property investment advisors and wealth creation seminars, criticizing the Commonwealth government's inaction and advocating for a coordinated national approach to protect investors.
AnsweredQoN 1119Legislative Assembly
QuestionView source ↗
Will the minister advise the House on the regulation of property investment advisers involved in so-called wealth creation seminars? Mr J.C. KOBELKE
AnswerView source ↗
I thank the member for Albany for his question. He has taken a real interest in this matter because many of his constituents were caught in the finance brokers scandal and he is very much aware of the need to ensure that protection is provided by the appropriate regulatory regime. Wealth creation seminars are a concern to ministers in the various States but unfortunately the commonwealth minister does not take it seriously. I refer to an advertisement that was placed in a newspaper by Henry Kaye. The headline reads - I’ll make 5 ‘ordinary’ Australians into ‘Property Millionaires’+ in just 6 months . . . using no money down, no debt and no equity . . . And so it goes on. People get sucked into receiving taxation advice but receive financial advice on how they can generate wealth. Mr Henry Kaye and his organisation, the National Investment Institute, have been taken to the Federal Court by the Australian Securities and Investments Commission, which was able to obtain enforceable undertakings. At the last ministerial council, state ministers asked the Commonwealth to do something about this matter. At that meeting I quoted what the Reserve Bank Governor Ian Macfarlane told the House of Representatives Standing Committee on Economics, Finance and Public Administration on 6 June 2003. He stated - . . . I think there is a regulatory gap there. It is clearly a problem if there is one group of people who are holding seminars on how to invest your money who are regulated - the financial planners - and there is another group who are doing almost exactly the same thing, although doing it within the one asset class, which is property, who are unregulated. So I think there is a need to extend the capacity for ASIC to do that. Of course, the federal parliamentary secretary Ian Campbell said that that is a real estate matter and that the States are responsible for regulating real estate. We do have that responsibility and, on the whole, we do it well. However, we are not talking about real estate sales; we are talking about financial advice relating to investments in real estate. That is a matter for which the federal Government has refused to take responsibility. It looks after every other area of the finance industry; however, when it comes to financial advice that is largely tied to investments in property, it refuses to act. At the ministerial council it was agreed that the States would move and that the Commonwealth would at least become involved in trying to coordinate the matter so that there is a standard approach across Australia. Clearly, we are willing to fit in with that. However, it is taking too long and would be done much more efficiently if the Commonwealth used its legislation - it already has the legislation - to take action. Following the Governor of the Reserve Bank drawing it to the attention of a federal parliamentary committee, the Chairman of the Australian Competition and Consumer Commission, Graeme Samuel, has stated that the ACCC is concerned that in a hot property market consumers are being pressured into joining property investment programs that promise massive wealth. The Governor of the Reserve Bank and the chairman of the ACCC have pointed out that this is a major problem area. This Government has drawn mezzanine financing to the Commonwealth’s attention on several occasions, as just one vehicle that puts consumers in jeopardy. We will continue to work with the other States to try to cover this area and give greater protection to investors, but the Commonwealth is passing the buck and saying that the States should do it. The States are doing it by default only because the Commonwealth has failed to take its responsibility in this area. This is clearly a key part of the financial industry and is not a specific matter relating to real estate. It is an issue of real concern and we will continue to work cooperatively with the States, but we hope the Commonwealth will play its more appropriate role and put the required regulatory regime in place.
Mr J.C. KOBELKE replied: I thank the member for Albany for his question. He has taken a real interest in this matter because many of his constituents were caught in the finance brokers scandal and he is very much aware of the need to ensure that protection is provided by the appropriate regulatory regime. Wealth creation seminars are a concern to ministers in the various States but unfortunately the commonwealth minister does not take it seriously. I refer to an advertisement that was placed in a newspaper by Henry Kaye. The headline reads - I’ll make 5 ‘ordinary’ Australians into ‘Property Millionaires’+ in just 6 months . . . using no money down, no debt and no equity . . . And so it goes on. People get sucked into receiving taxation advice but receive financial advice on how they can generate wealth. Mr Henry Kaye and his organisation, the National Investment Institute, have been taken to the Federal Court by the Australian Securities and Investments Commission, which was able to obtain enforceable undertakings. At the last ministerial council, state ministers asked the Commonwealth to do something about this matter. At that meeting I quoted what the Reserve Bank Governor Ian Macfarlane told the House of Representatives Standing Committee on Economics, Finance and Public Administration on 6 June 2003. He stated - . . . I think there is a regulatory gap there. It is clearly a problem if there is one group of people who are holding seminars on how to invest your money who are regulated - the financial planners - and there is another group who are doing almost exactly the same thing, although doing it within the one asset class, which is property, who are unregulated. So I think there is a need to extend the capacity for ASIC to do that. Of course, the federal parliamentary secretary Ian Campbell said that that is a real estate matter and that the States are responsible for regulating real estate. We do have that responsibility and, on the whole, we do it well. However, we are not talking about real estate sales; we are talking about financial advice relating to investments in real estate. That is a matter for which the federal Government has refused to take responsibility. It looks after every other area of the finance industry; however, when it comes to financial advice that is largely tied to investments in property, it refuses to act. At the ministerial council it was agreed that the States would move and that the Commonwealth would at least become involved in trying to coordinate the matter so that there is a standard approach across Australia. Clearly, we are willing to fit in with that. However, it is taking too long and would be done much more efficiently if the Commonwealth used its legislation - it already has the legislation - to take action. Following the Governor of the Reserve Bank drawing it to the attention of a federal parliamentary committee, the Chairman of the Australian Competition and Consumer Commission, Graeme Samuel, has stated that the ACCC is concerned that in a hot property market consumers are being pressured into joining property investment programs that promise massive wealth. The Governor of the Reserve Bank and the chairman of the ACCC have pointed out that this is a major problem area. This Government has drawn mezzanine financing to the Commonwealth’s attention on several occasions, as just one vehicle that puts consumers in jeopardy. We will continue to work with the other States to try to cover this area and give greater protection to investors, but the Commonwealth is passing the buck and saying that the States should do it. The States are doing it by default only because the Commonwealth has failed to take its responsibility in this area. This is clearly a key part of the financial industry and is not a specific matter relating to real estate. It is an issue of real concern and we will continue to work cooperatively with the States, but we hope the Commonwealth will play its more appropriate role and put the required regulatory regime in place.
I thank the member for Albany for his question. He has taken a real interest in this matter because many of his constituents were caught in the finance brokers scandal and he is very much aware of the need to ensure that protection is provided by the appropriate regulatory regime. Wealth creation seminars are a concern to ministers in the various States but unfortunately the commonwealth minister does not take it seriously. I refer to an advertisement that was placed in a newspaper by Henry Kaye. The headline reads - I’ll make 5 ‘ordinary’ Australians into ‘Property Millionaires’+ in just 6 months . . . using no money down, no debt and no equity . . . And so it goes on. People get sucked into receiving taxation advice but receive financial advice on how they can generate wealth. Mr Henry Kaye and his organisation, the National Investment Institute, have been taken to the Federal Court by the Australian Securities and Investments Commission, which was able to obtain enforceable undertakings. At the last ministerial council, state ministers asked the Commonwealth to do something about this matter. At that meeting I quoted what the Reserve Bank Governor Ian Macfarlane told the House of Representatives Standing Committee on Economics, Finance and Public Administration on 6 June 2003. He stated - . . . I think there is a regulatory gap there. It is clearly a problem if there is one group of people who are holding seminars on how to invest your money who are regulated - the financial planners - and there is another group who are doing almost exactly the same thing, although doing it within the one asset class, which is property, who are unregulated. So I think there is a need to extend the capacity for ASIC to do that. Of course, the federal parliamentary secretary Ian Campbell said that that is a real estate matter and that the States are responsible for regulating real estate. We do have that responsibility and, on the whole, we do it well. However, we are not talking about real estate sales; we are talking about financial advice relating to investments in real estate. That is a matter for which the federal Government has refused to take responsibility. It looks after every other area of the finance industry; however, when it comes to financial advice that is largely tied to investments in property, it refuses to act. At the ministerial council it was agreed that the States would move and that the Commonwealth would at least become involved in trying to coordinate the matter so that there is a standard approach across Australia. Clearly, we are willing to fit in with that. However, it is taking too long and would be done much more efficiently if the Commonwealth used its legislation - it already has the legislation - to take action. Following the Governor of the Reserve Bank drawing it to the attention of a federal parliamentary committee, the Chairman of the Australian Competition and Consumer Commission, Graeme Samuel, has stated that the ACCC is concerned that in a hot property market consumers are being pressured into joining property investment programs that promise massive wealth. The Governor of the Reserve Bank and the chairman of the ACCC have pointed out that this is a major problem area. This Government has drawn mezzanine financing to the Commonwealth’s attention on several occasions, as just one vehicle that puts consumers in jeopardy. We will continue to work with the other States to try to cover this area and give greater protection to investors, but the Commonwealth is passing the buck and saying that the States should do it. The States are doing it by default only because the Commonwealth has failed to take its responsibility in this area. This is clearly a key part of the financial industry and is not a specific matter relating to real estate. It is an issue of real concern and we will continue to work cooperatively with the States, but we hope the Commonwealth will play its more appropriate role and put the required regulatory regime in place.
Wealth creation seminars are a concern to ministers in the various States but unfortunately the commonwealth minister does not take it seriously. I refer to an advertisement that was placed in a newspaper by Henry Kaye. The headline reads - I’ll make 5 ‘ordinary’ Australians into ‘Property Millionaires’+ in just 6 months . . . using no money down, no debt and no equity . . . And so it goes on. People get sucked into receiving taxation advice but receive financial advice on how they can generate wealth. Mr Henry Kaye and his organisation, the National Investment Institute, have been taken to the Federal Court by the Australian Securities and Investments Commission, which was able to obtain enforceable undertakings. At the last ministerial council, state ministers asked the Commonwealth to do something about this matter. At that meeting I quoted what the Reserve Bank Governor Ian Macfarlane told the House of Representatives Standing Committee on Economics, Finance and Public Administration on 6 June 2003. He stated - . . . I think there is a regulatory gap there. It is clearly a problem if there is one group of people who are holding seminars on how to invest your money who are regulated - the financial planners - and there is another group who are doing almost exactly the same thing, although doing it within the one asset class, which is property, who are unregulated. So I think there is a need to extend the capacity for ASIC to do that. Of course, the federal parliamentary secretary Ian Campbell said that that is a real estate matter and that the States are responsible for regulating real estate. We do have that responsibility and, on the whole, we do it well. However, we are not talking about real estate sales; we are talking about financial advice relating to investments in real estate. That is a matter for which the federal Government has refused to take responsibility. It looks after every other area of the finance industry; however, when it comes to financial advice that is largely tied to investments in property, it refuses to act. At the ministerial council it was agreed that the States would move and that the Commonwealth would at least become involved in trying to coordinate the matter so that there is a standard approach across Australia. Clearly, we are willing to fit in with that. However, it is taking too long and would be done much more efficiently if the Commonwealth used its legislation - it already has the legislation - to take action. Following the Governor of the Reserve Bank drawing it to the attention of a federal parliamentary committee, the Chairman of the Australian Competition and Consumer Commission, Graeme Samuel, has stated that the ACCC is concerned that in a hot property market consumers are being pressured into joining property investment programs that promise massive wealth. The Governor of the Reserve Bank and the chairman of the ACCC have pointed out that this is a major problem area. This Government has drawn mezzanine financing to the Commonwealth’s attention on several occasions, as just one vehicle that puts consumers in jeopardy. We will continue to work with the other States to try to cover this area and give greater protection to investors, but the Commonwealth is passing the buck and saying that the States should do it. The States are doing it by default only because the Commonwealth has failed to take its responsibility in this area. This is clearly a key part of the financial industry and is not a specific matter relating to real estate. It is an issue of real concern and we will continue to work cooperatively with the States, but we hope the Commonwealth will play its more appropriate role and put the required regulatory regime in place.
. . . using no money down, no debt and no equity . . .
Following the Governor of the Reserve Bank drawing it to the attention of a federal parliamentary committee, the Chairman of the Australian Competition and Consumer Commission, Graeme Samuel, has stated that the ACCC is concerned that in a hot property market consumers are being pressured into joining property investment programs that promise massive wealth. The Governor of the Reserve Bank and the chairman of the ACCC have pointed out that this is a major problem area. This Government has drawn mezzanine financing to the Commonwealth’s attention on several occasions, as just one vehicle that puts consumers in jeopardy. We will continue to work with the other States to try to cover this area and give greater protection to investors, but the Commonwealth is passing the buck and saying that the States should do it. The States are doing it by default only because the Commonwealth has failed to take its responsibility in this area. This is clearly a key part of the financial industry and is not a specific matter relating to real estate. It is an issue of real concern and we will continue to work cooperatively with the States, but we hope the Commonwealth will play its more appropriate role and put the required regulatory regime in place.
Mr J.C. KOBELKE replied: I thank the member for Albany for his question. He has taken a real interest in this matter because many of his constituents were caught in the finance brokers scandal and he is very much aware of the need to ensure that protection is provided by the appropriate regulatory regime. Wealth creation seminars are a concern to ministers in the various States but unfortunately the commonwealth minister does not take it seriously. I refer to an advertisement that was placed in a newspaper by Henry Kaye. The headline reads - I’ll make 5 ‘ordinary’ Australians into ‘Property Millionaires’+ in just 6 months . . . using no money down, no debt and no equity . . . And so it goes on. People get sucked into receiving taxation advice but receive financial advice on how they can generate wealth. Mr Henry Kaye and his organisation, the National Investment Institute, have been taken to the Federal Court by the Australian Securities and Investments Commission, which was able to obtain enforceable undertakings. At the last ministerial council, state ministers asked the Commonwealth to do something about this matter. At that meeting I quoted what the Reserve Bank Governor Ian Macfarlane told the House of Representatives Standing Committee on Economics, Finance and Public Administration on 6 June 2003. He stated - . . . I think there is a regulatory gap there. It is clearly a problem if there is one group of people who are holding seminars on how to invest your money who are regulated - the financial planners - and there is another group who are doing almost exactly the same thing, although doing it within the one asset class, which is property, who are unregulated. So I think there is a need to extend the capacity for ASIC to do that. Of course, the federal parliamentary secretary Ian Campbell said that that is a real estate matter and that the States are responsible for regulating real estate. We do have that responsibility and, on the whole, we do it well. However, we are not talking about real estate sales; we are talking about financial advice relating to investments in real estate. That is a matter for which the federal Government has refused to take responsibility. It looks after every other area of the finance industry; however, when it comes to financial advice that is largely tied to investments in property, it refuses to act. At the ministerial council it was agreed that the States would move and that the Commonwealth would at least become involved in trying to coordinate the matter so that there is a standard approach across Australia. Clearly, we are willing to fit in with that. However, it is taking too long and would be done much more efficiently if the Commonwealth used its legislation - it already has the legislation - to take action. Following the Governor of the Reserve Bank drawing it to the attention of a federal parliamentary committee, the Chairman of the Australian Competition and Consumer Commission, Graeme Samuel, has stated that the ACCC is concerned that in a hot property market consumers are being pressured into joining property investment programs that promise massive wealth. The Governor of the Reserve Bank and the chairman of the ACCC have pointed out that this is a major problem area. This Government has drawn mezzanine financing to the Commonwealth’s attention on several occasions, as just one vehicle that puts consumers in jeopardy. We will continue to work with the other States to try to cover this area and give greater protection to investors, but the Commonwealth is passing the buck and saying that the States should do it. The States are doing it by default only because the Commonwealth has failed to take its responsibility in this area. This is clearly a key part of the financial industry and is not a specific matter relating to real estate. It is an issue of real concern and we will continue to work cooperatively with the States, but we hope the Commonwealth will play its more appropriate role and put the required regulatory regime in place.
I thank the member for Albany for his question. He has taken a real interest in this matter because many of his constituents were caught in the finance brokers scandal and he is very much aware of the need to ensure that protection is provided by the appropriate regulatory regime. Wealth creation seminars are a concern to ministers in the various States but unfortunately the commonwealth minister does not take it seriously. I refer to an advertisement that was placed in a newspaper by Henry Kaye. The headline reads - I’ll make 5 ‘ordinary’ Australians into ‘Property Millionaires’+ in just 6 months . . . using no money down, no debt and no equity . . . And so it goes on. People get sucked into receiving taxation advice but receive financial advice on how they can generate wealth. Mr Henry Kaye and his organisation, the National Investment Institute, have been taken to the Federal Court by the Australian Securities and Investments Commission, which was able to obtain enforceable undertakings. At the last ministerial council, state ministers asked the Commonwealth to do something about this matter. At that meeting I quoted what the Reserve Bank Governor Ian Macfarlane told the House of Representatives Standing Committee on Economics, Finance and Public Administration on 6 June 2003. He stated - . . . I think there is a regulatory gap there. It is clearly a problem if there is one group of people who are holding seminars on how to invest your money who are regulated - the financial planners - and there is another group who are doing almost exactly the same thing, although doing it within the one asset class, which is property, who are unregulated. So I think there is a need to extend the capacity for ASIC to do that. Of course, the federal parliamentary secretary Ian Campbell said that that is a real estate matter and that the States are responsible for regulating real estate. We do have that responsibility and, on the whole, we do it well. However, we are not talking about real estate sales; we are talking about financial advice relating to investments in real estate. That is a matter for which the federal Government has refused to take responsibility. It looks after every other area of the finance industry; however, when it comes to financial advice that is largely tied to investments in property, it refuses to act. At the ministerial council it was agreed that the States would move and that the Commonwealth would at least become involved in trying to coordinate the matter so that there is a standard approach across Australia. Clearly, we are willing to fit in with that. However, it is taking too long and would be done much more efficiently if the Commonwealth used its legislation - it already has the legislation - to take action. Following the Governor of the Reserve Bank drawing it to the attention of a federal parliamentary committee, the Chairman of the Australian Competition and Consumer Commission, Graeme Samuel, has stated that the ACCC is concerned that in a hot property market consumers are being pressured into joining property investment programs that promise massive wealth. The Governor of the Reserve Bank and the chairman of the ACCC have pointed out that this is a major problem area. This Government has drawn mezzanine financing to the Commonwealth’s attention on several occasions, as just one vehicle that puts consumers in jeopardy. We will continue to work with the other States to try to cover this area and give greater protection to investors, but the Commonwealth is passing the buck and saying that the States should do it. The States are doing it by default only because the Commonwealth has failed to take its responsibility in this area. This is clearly a key part of the financial industry and is not a specific matter relating to real estate. It is an issue of real concern and we will continue to work cooperatively with the States, but we hope the Commonwealth will play its more appropriate role and put the required regulatory regime in place.
Wealth creation seminars are a concern to ministers in the various States but unfortunately the commonwealth minister does not take it seriously. I refer to an advertisement that was placed in a newspaper by Henry Kaye. The headline reads - I’ll make 5 ‘ordinary’ Australians into ‘Property Millionaires’+ in just 6 months . . . using no money down, no debt and no equity . . . And so it goes on. People get sucked into receiving taxation advice but receive financial advice on how they can generate wealth. Mr Henry Kaye and his organisation, the National Investment Institute, have been taken to the Federal Court by the Australian Securities and Investments Commission, which was able to obtain enforceable undertakings. At the last ministerial council, state ministers asked the Commonwealth to do something about this matter. At that meeting I quoted what the Reserve Bank Governor Ian Macfarlane told the House of Representatives Standing Committee on Economics, Finance and Public Administration on 6 June 2003. He stated - . . . I think there is a regulatory gap there. It is clearly a problem if there is one group of people who are holding seminars on how to invest your money who are regulated - the financial planners - and there is another group who are doing almost exactly the same thing, although doing it within the one asset class, which is property, who are unregulated. So I think there is a need to extend the capacity for ASIC to do that. Of course, the federal parliamentary secretary Ian Campbell said that that is a real estate matter and that the States are responsible for regulating real estate. We do have that responsibility and, on the whole, we do it well. However, we are not talking about real estate sales; we are talking about financial advice relating to investments in real estate. That is a matter for which the federal Government has refused to take responsibility. It looks after every other area of the finance industry; however, when it comes to financial advice that is largely tied to investments in property, it refuses to act. At the ministerial council it was agreed that the States would move and that the Commonwealth would at least become involved in trying to coordinate the matter so that there is a standard approach across Australia. Clearly, we are willing to fit in with that. However, it is taking too long and would be done much more efficiently if the Commonwealth used its legislation - it already has the legislation - to take action. Following the Governor of the Reserve Bank drawing it to the attention of a federal parliamentary committee, the Chairman of the Australian Competition and Consumer Commission, Graeme Samuel, has stated that the ACCC is concerned that in a hot property market consumers are being pressured into joining property investment programs that promise massive wealth. The Governor of the Reserve Bank and the chairman of the ACCC have pointed out that this is a major problem area. This Government has drawn mezzanine financing to the Commonwealth’s attention on several occasions, as just one vehicle that puts consumers in jeopardy. We will continue to work with the other States to try to cover this area and give greater protection to investors, but the Commonwealth is passing the buck and saying that the States should do it. The States are doing it by default only because the Commonwealth has failed to take its responsibility in this area. This is clearly a key part of the financial industry and is not a specific matter relating to real estate. It is an issue of real concern and we will continue to work cooperatively with the States, but we hope the Commonwealth will play its more appropriate role and put the required regulatory regime in place.
. . . using no money down, no debt and no equity . . .
Following the Governor of the Reserve Bank drawing it to the attention of a federal parliamentary committee, the Chairman of the Australian Competition and Consumer Commission, Graeme Samuel, has stated that the ACCC is concerned that in a hot property market consumers are being pressured into joining property investment programs that promise massive wealth. The Governor of the Reserve Bank and the chairman of the ACCC have pointed out that this is a major problem area. This Government has drawn mezzanine financing to the Commonwealth’s attention on several occasions, as just one vehicle that puts consumers in jeopardy. We will continue to work with the other States to try to cover this area and give greater protection to investors, but the Commonwealth is passing the buck and saying that the States should do it. The States are doing it by default only because the Commonwealth has failed to take its responsibility in this area. This is clearly a key part of the financial industry and is not a specific matter relating to real estate. It is an issue of real concern and we will continue to work cooperatively with the States, but we hope the Commonwealth will play its more appropriate role and put the required regulatory regime in place.
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