Personal Financial Advice – A Lesson For Investors

Personal Financial Advice – A Lesson For Investors


In the High Court case of Westpac Securities Administration Ltd v ASIC [2021] HCA 3 (‘Westpac v ASIC’), the High Court clarified the legal test for providing personal financial advice. The High Court unanimously upheld the Full Federal Court’s decision that Westpac had provided ‘personal advice’ to its customers, in breach of its Australian Financial Services License (‘AFSL’) and section 766B(3)(b) of the Corporations Act 2001 (Cth) (‘Act’).

The AFSL, granted under section 913B of the Act, allows Westpac to provide financial services, financial product advice, albeit the AFSL does not provide Westpac with an ability to engage in or provide personal financial advice.

Section 766B(3)(b) of the Corporations Act 2001 (Cth) defines ‘personal advice’ to include ‘financial product advice that is given or directed to a person (including by electronic means) where:

  • the provider of the advice has considered one or more of the person’s objectives, financial situation and needs; or
  • a reasonable person might expect the provider to have considered one or more of those matters’.


During a “Superannuation Activation Team” campaign (‘Campaign’), Westpac contacted its existing clients, customers and members (collectively, ‘Clients’) with the intention of enticing the Clients to combine any external superannuation accounts with their pre-existing Westpac superannuation account, such that monies from third party superannuation funds (once located) would roll over into their Westpac account. The Campaign was structured with a view to providing general advice (and not personal financial advice) to the Clients.

The issue arises in circumstances where Westpac, as a financial services provider with an AFSL, would be taken to be providing personal financial advice, regardless of the intention to provide general advice in any event.

At trial, Westpac conceded that it provided financial product advice to the Clients within the meaning of 766A(1)(a) of the Act. The issue on appeal was whether Westpac’s advice amounted to ‘personal advice’ within the meaning of section 766B(3)(b) of the Act (detailed above).

It was found that Westpac not only breached the conditions of the AFSL, but also failed to do all things necessary to ensure that the financial services covered by the AFSL were provided efficiently, honestly and fairly. By telephoning the Clients for the purposes of the Campaign, the High Court ultimately found that:

‘… in all the circumstances, the financial product advice Westpac gave to its members was personal advice within the meaning of section 766B(3)(b) of the Corporations Act.’


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