Permanent stop order made against financial adviser

This replaces the interim stop order issued to McEwen and Associates last month and will remain in force until the FMA varies, suspends, or revokes the order. 

The FMA says it is satisfied communications made by McEwen and Associates relating to offers of financial products were false or misleading, or likely to mislead or confuse, contained a material misdescription or material error and did not comply with the Financial Markets Conduct Act  with respect to unsubstantiated claims made as to the value of the financial products offered.

McEwan is prohibited from making offers, issues, sales or other disposals financial products, distributing any restricted communication that relates to an offer of McEwen and Associates’ financial products and  accepting further contributions, investments, or deposits in respect of McEwen and Associates’ Financial Products. 

During its investigations, the FMA says it found shareholder agreements made inaccurate statements about the company’s holding of shares on behalf of investors at that time, while sale and purchase agreements (S&PAs) relating to offers of financial products included a representation that the investor would be entitled to receive a return on investment that would be paid out in the form of additional equity where it was unclear and confusing as to how this would be enforceable since the equity issuer is not a party to the S&PA.