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Craig Fraser, of VIP Financial, said his client, who is aged in her mid-70s, contacted him in June requesting a withdrawal from her DIMS account.
She made one request, which was processed. But two weeks later, she requested another $60,000.
“That set all sorts of alarm bells ringing,” Fraser said.
He asked more questions of the client, whom he said was a bit cagey initially about what the money was for.
While Fraser said he “felt terrible” for pushing her about why she wanted the money, he eventually discovered she was trying to help a friend whom she had never met.
The person had been emailing her for a couple of months, and there had also been emails from someone claiming to be the friend’s son at boarding school in the United States.
“She was going to send a whole lot more,” Fraser said.
He told the client he had an obligation to her family and asked her to send the emails they had traded. “It wasn’t a matter of convincing, just pointing out that I think this could be a scam.”
The woman lost $30,000 but was relieved not to have lost more.
Fraser said he had not been able to persuade her to report the fraud.
“She feels like a foolish old lady who just wants to forget.”
But he said it showed his systems, including a vulnerable client policy, were working. “When you know your clients, you know when something is not right.”
In a case considered by IFSO earlier in the year, a woman complained that an adviser did not stop her brother withdrawing a total of $189,100 from a family trust’s bank account.
She said the adviser had a duty of care to question the reason for the withdrawals but IFSO said that was not necessary because the man was authorised to make withdrawal requests. The adviser was not required to give financial advice.
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FANZ: Perhaps this story could be 'leaked' to mainstream media to demonstrate the value of an adviser? I'd rather read this, than learn of another 'hard done by insurance' story.