propertymentors.com.aua guide with the questions in the margin

A guide published by Dotto

Property mentors: where education ends and financial advice begins

Property seminars, courses and mentoring programs teach, and some of them also sell. This plain-language guide sets out what Australia’s regulators say about the line between learning and advice, and the protections that apply when a seminar, a course or a mentor comes with a sales pitch.

General information, not financial or legal advice. To check a rule or a licence for yourself, start with Moneysmart, ASIC’s consumer website.

A page of seminar copy, marked up

An illustration. The typed lines are invented and come from no real seminar. Every pencilled note draws on Moneysmart’s page on investment seminars or its page on SMSFs and property.

Learn the property system that delivers guaranteed returns.

AskGuaranteed by whom? Moneysmart lists a promise of guaranteed or above-average returns among the warning signs.

Places close tonight. Sign up before you leave.

AskWhy tonight? Moneysmart warns about seminars that urge a quick decision or an on-the-spot sign-up, and that leave little time to get a second opinion.

Our presenter will show you how to use your super to buy.

AskIs the presenter licensed? Moneysmart says SMSF advice may only come from the holder of an Australian financial services licence, or from someone a licensee has authorised.

Tonight’s session is free.

AskWhat comes after free? Moneysmart says a free first event can lead to pressure to buy reports and books, and to sign up for dearer seminars or courses.

Where the line sits

Facts are usually not advice. ASIC’s licensing guide says a communication made up only of factual information will generally not be financial product advice, and generally counts people’s rights and obligations under legislation as factual information. It draws the line at opinion: a recommendation or a statement of opinion is financial product advice when it is “intended to influence a person or persons in making a decision about a particular financial product or class of financial products”, or could reasonably be seen that way, and no exemption applies.

AskIs this a fact, or an opinion about what I should do with my super or an investment?

“The presenter merely provides a general description of the different types of financial products that are available for investment purposes. This is likely to constitute the provision of factual information only.”

“The desirability of property trusts is a matter of opinion and the presenter’s statements could reasonably be regarded as intending to influence the attendees to invest in property trusts.”

ASIC Regulatory Guide 36, Table 1, the seminar example

A house or a block of land bought directly is a different matter. Moneysmart lists direct investment in real estate among the investments that ASIC does not regulate, and says it is harder to get help when something unlicensed and unregulated goes wrong.

The licences come back in through the money around the property. Moneysmart says SMSF advice may only come from the holder of an Australian financial services (AFS) licence, or from someone a licensee has authorised, and it tells borrowers to check that a mortgage broker holds a licence to give credit advice or represents a licensee.

Two red pencils with pink erasers lying on ruled, hole-punched notepaper, with a metal sharpener out of focus behind them.
Two pencils, erasers first. Photo by stevepb on Pixabay.

Six pages, six questions in the margin

Each page answers one question from the official sources and leaves you the question worth asking in the room.

  1. Education or advice?

    When talk about property, super and borrowing needs a licence, in ASIC’s terms.

    Which part of this needs a licence?

  2. SMSFs and property sales

    What ASIC and the ATO say about setting up a self-managed super fund to buy property.

    Who is paid if I say yes?

  3. Seminars and unsolicited sales

    What the Australian Consumer Law counts as an unsolicited sale, read against a seminar room.

    Did I invite this sales pitch?

  4. Courses that are not as described

    Consumer guarantees for services, claims about results and “no refunds” terms.

    What exactly was promised, and where is it written?

  5. Checking a licence

    The public registers that show who may advise, lend or act as an estate agent.

    Which register would they be on?

  6. If something went wrong

    Complaints, reports and which body handles which problem.

    Whose scheme handles this complaint?

Sources