Fair Work’s Donna McKenna has given evidence into her own bad experience with the financial sector.Industrial umpire Donna McKenna is no stranger to disputes.
But after her “unhappy experiences” complaining that advice from a celebrity “financial guru” would have cost her $500,000, the Fair Work commissioner wonders what hope there is for everyday Australians.
Ms McKenna went to Sam Henderson for advice after seeing him on television and reading his articles in publications such as the Australian Financial Review and Money Magazine.
She also knew his advisory firm Henderson Maxwell had been named the Association of Financial Advisers’ 2016 practice of the year.
But the advice she received was “risible”, Ms McKenna told the banking royal commission.
“I can remember saying to my son words to the effect I can’t believe this.
“I’ve been to see the financial planner of the year and this is what you get.
“I thought that if I went to an independently-owned financial planning firm that I wouldn’t be subjected to product flogging of the type associated with the big banks, and yet, all I’m being flogged is Henderson Maxwell’s own products and services.”
The commission heard Ms McKenna would have lost $500,000 “just like that” if she had followed the advice, as she would have forfeited her rights to that entire deferred lump sum benefit if she accessed her superannuation before the earliest retirement age of 58.
Mr Henderson blamed the problems with the advice on an error in the research conducted by a paraplanner.
He offered a refund of the $4950 upfront plan preparation fee but Ms McKenna took her complaint to another professional body, the Financial Planning Association, in March 2017.
The complaint and disciplinary process has not been finalised.
Ms McKenna said she felt she had a public duty to share her story and “unhappy experiences with the FPA” with the royal commission.
“If someone with my educational and occupational background hits a wall when you endeavour to engage proper disciplinary processes, what hope would someone who does not have those type of occupational background and skills – what hope are other people going to have?
“It seems that it is going to take a royal commission so that I can find out what happened to my complaint before the FPA.”
FPA CEO Dante De Gori will give evidence about the disciplinary system within the financial advice sector when the commission hearing resumes on Thursday.
Australian Associated Press