Naomi Halpern, a victim of bad financial advice who was caught up in the collapse of forestry investment scheme Timbercorp, will take the fight up to the financial sector and the corporate watchdog at the next federal election.
The Apollo Bay resident has been named as the lead Victorian Senate candidate for Nick Xenophon's new political party set up by the independent South Australian senator who has been a vocal campaigner for cleaning up the financial advice sector.
In her first interview since being preselected for The Xenophon Team in December, Ms Halpern took a swipe at the Australian Securities and Investments Commission's handling of financial collapses and white collar crime.
"There needs to be an appropriate organisation to investigate complaints of white collar crime," Ms Halpern said.
"ASIC has really failed. They've dropped the ball on this."
Ms Halpern, a trained social worker who now specialises in consulting and training mental health professionals, invested in forestry schemes set up by Timbercorp in the years before the company's 2009 collapse.
Like many other Australians caught up in financial collapses, Ms Halpern thought Timbercorp was a safe investment after it was recommended by her then financial adviser, Peter Holt.
Mr Holt was involved in running an accounting and financial advice outfit Holt Norman Ashman Baker in the leafy suburb of Kew and one of the biggest promoters of Timbercorp products.
By 2012, Mr Holt was bankrupt. That same year he was banned as a financial adviser after an ASIC investigation – driven by Holt Norman Ashman Baker clients – found he had given inappropriate advice to his clients. An associated entity to Holt Norman Ashman Baker, Holt Norman & Co was also stripped of its Australian Financial Services Licence in 2012.
Mr Holt's ASIC ban ended in 2015 and his bankruptcy was discharged. However, investigations into his conduct, by ASIC and liquidators, including his allegedly "fake" bankruptcy continue. Mr Holt did not return calls.
Supporter of royal commission
As head of the Holt Norman Baker Ashman Action Group, Ms Halpern has testified at Senate hearings into the collapse of forestry managed investment schemes and into the scrutiny of financial advice.
Ms Halpern said she supported calls for a royal commission into misconduct in the financial services sector.
"What's happened to so many people should not have happened," she said.
Ms Halpern said often schemes where serious misconduct is thought to have occurred are very complicated and created serious issues for ASIC, which is famously starved of resources.
"It's like ASIC has thrown it [complex financial collapses] into the too hard basket because they're either not willing, not interested or perhaps just not adequately resourced to do the investigations," Ms Halpern said.
She said ASIC often received information about dodgy financial advisors years ahead of doing a full investigation.
"There needs to be some kind of a body, organisation or commission that should have the power to really thoroughly investigate these cases and do it quickly. We're seven years down the track with Timbercorp," she said.
"This body also needs to have powers to reward not only restitution but compensation as well."
Ms Halpern also welcomed the Turnbull government's innovation package but said the government needed to safeguard victims of financial misconduct from people manipulating the new laws to their own advantage.
ASIC said it was unable to comment on operational matters, including when it received complaints.
Responding to questions from Fairfax Media about whether ASIC lacked the will to pursue allegedly rogue advisers, a spokeswoman for ASIC said: "We have been very active in pursuing financial advisers engaging in misconduct and have banned 24 advisers in the six months to the end of December 2015."