Port Phillip Publishing fined $600,000 over misleading article
Online financial publisher Port Phillip Publishing (PPP) and its former director and CEO Kristan Sayce have been fined over a misleading article which promoted an investment strategy allowing consumers to ‘piggyback’ the Australian government’s Future Fund.
PPP agreed to pay a $600,000 penalty to settle the case, brought against the publisher by the Australian Securities and Investments Commission (ASIC) and Sayce was fined $50,000.
Port Phillip Publishing supports itself largely on subscription fees
As a result of the ruling made yesterday, Sayce has also been disqualified from managing a corporation for 12 months. He resigned from PPP in May 2019.
The information in question was published across two PPP websites and emailed to the publisher’s 200,000 subscribers in 2017, once in ‘Everyday Australians Now Legally “Piggybacking” the Future Fund…and collecting extra monthly income injections of $540 right up to $6,667’ and also in ‘Your Quick Start Guide to “Piggybacking” the Future Fund’.
ASIC alleged in its case against the publisher than the claims were both ‘misleading’ and ‘deceptive’.
The information was targeted at retiree investors and people approaching retirement, suggesting they could significantly increase their monthly income, without including the required investment of $154,000 to $1.9m which would need to be made to generate the returns.
The articles were written by retirement investment expert Matthew Hibbard, but the ruling stated that Sayce had reviewed and approved the content. In its initial inquiry, ASIC alleged Hibbard did not conduct the 900 hours of research related to the strategy that he claimed to have conducted.
It was also alleged that the printed article didn’t in fact represent Hibbard’s opinion, but was copied from an American related entity of PPP entitled ‘Americans Now Legally Piggybacking Canadian Social Security … And Collecting Extra Monthly Checks from $400 to $4,700’ and that Hibbard had no qualifications or experience in providing income or investment advice to retired investors.
“If investors had adopted the investment strategy in PPP’s Guide, they were likely to have generated lower returns than the returns promoted in the Promo Letter and exposed investors to a greater level of risk than that adopted by the Future Fund in September 2017. ASIC seeks to promote confident and informed participation of investors and in this case, investors were misled,” said ASIC deputy chair Daniel Crennan QC.
ASIC requested in its initial proceedings that both the publication and Sayce pay a penalty for breaching consumer protection provisions, but also sought corrective advertising orders, injunctions and disqualification orders against Sayce. It appears Sayce has removed his personal blog and Twitter account since the ruling.
At the time of the initial investigation, Sayce said the proposed penalty was ‘beyond all reasonableness’.
“ASIC alleges that Port Phillip Publishing and I (as director and CEO) have misled and deceived investors as a result of a sales promotion that was in effect from around September to November 2017,” Sayce told Mumbrella.
“The premise of the sales promotion was that our income expert would try to mimic or match the performance of the Future Fund. He would attempt to do that by recommending listed investments, which broadly correlated with the Future Fund’s asset allocation.
“We disagree with the allegations, and will defend our position in the Federal Court.
“To be clear, Port Phillip Publishing does not manage money on behalf of investors, and our advisers are not permitted to invest in the stocks they recommend. Port Phillip Publishing only has a licence to provide general advice.
“While I acknowledge that all instances of misleading and deceptive conduct should be investigated, I consider the proposed penalty beyond all reasonableness and excessive.”
PPP also paid a $21,600 penalty in 2016 for a ‘misleading superannuation scare campaign’.
Mumbrella has approached Port Phillip Publishing for comment.
Kristan Sayce Is also a LinkedIn troll and generally [Edited under Mumbrella’s comment moderation policy]. Good riddance.
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Sensationalist misleading business model and very scammy.
block every creative from them,
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Fantastic news!
It’s about time this lot faced some consequences for their actions.
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He was also shamelessly defending himself in the comments of the original article with support from at least half a dozen sockpuppet accounts.
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The fines seem quite fair in retrospect to the code conduct, including all legislative regulations.
“Any misleading and or deceptive advice carried by financial agent/s and or anyone in other areas of public service ought to be accountable in law”.
This is “the ultimate protection to all consumers”, whether or not PPP agrees with or disagrees with the outcome.
PPP is lucky not to be taken via the Court process, and had it lost the case, the consequences would have outweighed the given fines, herein.
And, the worse case scenario if, in fact, PPP had undergone the Supreme Court process may have also denied them their license and those employed by PPP their jobs, in respectively.
This indiscretion ought to be a warning to PPP to appropriately advise their consumers with the utmost duty and care.
And, for a word of advice to the trolls, where this process has raised some concerns to me, as a proposed member, although have yet to agree, I will certainly give PPP the benefit of the doubt, in this instance. As I hope they have learnt their lesson via this particular process.
Regards to all.
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