Bourke-Shaw himself lost $525,000 through RAM investments.
According to a summary of facts in Bourke-Shaw's case, as well as inheriting clients he also recommended RAM portfolios to others and over time they invested $13.9 million with the firm.
While a portion of these funds were withdrawn, Oxford clients had $5.93 million still with RAM at the date of its collapse.
According to the summary, Bourke-Shaw failed to adequately analyse RAM and Ross before recommending these portfolios to clients:
"Mr Bourke-Shaw relied on old accolades (dating back to the 1990's) and the fact that he had held a RAM portfolio personally. He also failed to adequately monitor Mr Ross' and the RAM Portfolios' performance over time," Bourke-Shaw was licensed as an authorised financial adviser (AFA) by the Financial Markets Authority but surrendered this status earlier this year.
The FMA, which brought the case before the FADC, said it believed a reasonable AFA would have made further inquiries to make sure he or she was satisfied recommending RAM portfolio to clients was appropriate.
While Bourke-Shaw had raised issues with Ross he did not receive a satisfactory response.
The adviser did not follow up with further inquiries and the FMA believed Bourke-Shaw failed to communicate concerns about RAM to Oxford clients and thereby breached the financial adviser's code.
"In 2011 and 2012, Mr Bourke-Shaw and his business associate both held serious concerns about their clients' RAM portfolios. During this time, Mr Bourke-Shaw did not convey the true nature or level of his concerns to his clients when discussing their investment portfolios," the summary said.
According to the FMA, Bourke-Shaw also did not take adequate steps to ensure the service he was providing was suitable for clients, whom he described as "a lot of retired folk".
Bourke-Shaw also did not keep a written record of the advice given to clients, which the code requires.
In a decision released yesterday, the FADC fined Bourke-Shaw $4000 and censured him for the breaches of four AFA code standards.
Committee chairman Sir Bruce Robertson said in the decision that the breaches represented a "significant professional failure by Mr Bourke-Shaw".
"His clients were unable to make informed decisions about their exposure to RAM because he withheld information with which they should have been provided," Robertson said on behalf of the committee.
The committee did acknowledge that Bourke-Shaw found himself in a difficult position in regards to the RAM investments.
"In the face of Mr Ross' admitted frauds it is not clear that much could have been done, or losses avoided, even if his clients had been properly advised. Mr Bourke-Shaw was not directly responsible for the losses which arose because of the fraudulent conduct of Mr Ross, of which Mr Bourke-Shaw personally was also a victim," Robertson said.
"We accept that Mr Bourke-Shaw knows and understands the seriousness of his breaches but that is only part of the equation. A professional admonition and reprimand is a formal denunciation of the acts and omissions concerned and reinforces for the advisory profession as a whole the critical importance of compliance," the decision said.