The corporate regulator has accepted an enforceable undertaking from an AFSL holder after an investigation found breaches relating to managed discretionary account (MDA) services.
In a statement issued today, ASIC revealed that online foreign exchange broker Forex Financial Services was found to have been offering an individually managed account (IMA) which was an MDA in breach of its licence conditions.
Forex Financial Services’ AFSL prohibits offering an MDA service to retail clients except through a managed investment scheme.
The ASIC investigation raised concerns that the AFSL holder has “made representations on its website and during presentations to potential clients that were misleading or deceptive”.
ASIC Commissioner Greg Tanzer made broad comments regarding the structure and licensing of MDA services.
“An MDA service allows a broker to enter and exit trades on behalf of a client without seeking the client’s approval,” he said. “Consumers can face significant loss if the service is not provided appropriately.”
Under the terms of the EU, Forex FS will engage an independent compliance expert to conduct a review and will not offer MDA services to retail clients for a period of 10 years.
SUBSCRIBE TO THE IFA DAILY BULLETIN
21 Nov 2017Carwardine Financial completes compliance reviewBy Staff Reporter
21 Nov 2017Benchmark goes into liquidationBy Aleks Vickovich
21 Nov 2017Goals-based retail super product launchedBy Staff Reporter
21 Nov 2017DomaCom strikes deal with Moody’s AnalyticsBy Staff Reporter
21 Nov 2017Netwealth lists on ASXBy Tim Stewart
21 Nov 2017Perpetual announces departure of CEOBy Staff Reporter
- view all