Former financial adviser sentenced to 10 years’ imprisonment

Gabriel Nakhl was convicted on eight charges, brought by ASIC, of engaging in dishonest conduct with investor funds. The conduct affected 12 investors while Nakhl was a representative of Australian Financial Services Limited (in liquidation) and as sole director of SydFA Pty Ltd (deregistered).

ASIC revealed that Nakhl lost about $5.1 million he invested on behalf of the 12 investors.

The court found Nakhl advised clients to set up self-managed superannuation funds and to invest their superannuation and other funds in products such as shares, managed funds and high interest rate bank accounts. Rather than investing the 12 investors’ funds in these products, Nakhl used these funds 'as he pleased' and for his own purposes, ASIC said.

According to ASIC, Nakhl then lied to the investors, telling them that he had invested their funds in accordance with his advice and that their investments were performing well. He also tried to cover up his wrongdoing by having these 12 investors sign documents that supposedly authorised Nakhl to use the funds in the way he did.

"Mr Nakhl deliberately misled his clients and used their savings as he pleased. Clients should be able to trust their financial advisers. In this case, Mr Nakhl dishonestly and deliberately breached his clients’ trust. ASIC welcomes the sentencing decision handed down today," said ASIC commissioner Sean Hughes.

ASIC obtained orders against Nakhl in February 2013, freezing his assets. In April 2013, the amounts frozen in interim orders against Nakhl were about $7.7 million.

In November 2013, Nakhl was permanently prevented from providing financial services. He is also not allowed to manage a company until 2028.