Prosperity Advisers, a Newcastle-based multi-award winning accountancy and financial planning business, has been caught out in the Westpoint scandal, with angry clients chasing $15 million.
Prosperity Advisers, which boasts on its web site, of being Securitor’s ‘national practice of the year’ in 2004 and NSW ‘practice of the year’ in 2005, is facing demands from about 40 clients who collectively sank $15 million into Westpoint products. While the firm uses Asgard Wealth Management services, a spokesperson for the St George Bank-owned dealer group said Prosperity operated under its own Australian Financial Services licence and not Securitor’s. The Prosperity news comes in the same week as ‘The Australian’ newspaper revealed that 23 advisers in the dealer group Professional Investment Services (PIS) had put $19.92 million into Westpoint products. As ‘The Australian’ reported yesterday, PIS was considering compensating affected investors directly rather than facing legal action. It is understood many of the Prosperity clients who invested in Westpoint were high-ranking executives at the BHP steelworks in Newcastle. Prosperity clients stung by Westpoint losses met last night at the Newcastle Panthers’ Club to decide whether or not to join the Slater & Gordon class action. However, at the time ‘I&T News’ went to press, no decision had been made. In a statement sent to ‘I&T News’ yesterday, Allan McKeown, Prosperity chief executive, said: ‘We deeply regret any situation where a client loses money on an investment. Fortunately, the number of a clients that have been affected by Westpoint is minor. “We are working closely with those clients who have been affected to pursue all available avenues for the recovery of lost funds and have undertaken to do whatever is in our power to assist that process.” McKeown told the ‘Newcastle Herald’ last week that he invested some of his personal wealth in Westpoint and was “ outraged” at the way Westpoint had “misled the investment community”. In his statement to ‘I&T News’ yesterday, McKeown also said those clients affected by Westpoint would still make a positive return on their portfolios due to Prosperity’s balanced investment strategy and “careful management approach”. As well as the Asgard practices of the year awards, Prosperity boasts a slew of trophies including: an ‘innovation award’ in 2005 from the Fairfax-owned ‘ASSET’ magazine; the fourth-fastest growing and 38th overall in the ‘Top 100 Accountancy Firms’ category surveyed by ‘BRW’, another Fairfax publication; and number 69 in a list of ‘100 fastest growing companies in Australia’, which was also compiled by BRW. In December last years Prosperity also received an award from the Hunter Business Chamber for ‘business excellence’.
Since taking over the top job at the $44 billion Funds SA more than a year ago, chief executive John Piteo has ushered in an investment function overhaul and wrapped up an important stage of the fund’s five-year data transformation program. It pledges to recentre around investment performance and more efficient processes, as the “missing piece” has been found in incoming CIO Con Michalakis.
Darcy SongJanuary 10, 2025
