The corporate regulator has cancelled the AFSLs of seven unnamed financial planning groups following a surveillance of security bond lodgements.
ASIC has cancelled the seven AFS licences and referred another three for further action following a review the regulator undertook of licensees that had not requested a release of a security bond, required to be lodged with ASIC under a previous licensing regime.
“ASIC was concerned some licensees may not have requested the return of their security bond as they did not have an adequate professional indemnity insurance policy,” the statement said.
The review also led to ASIC prompting 17 entities to voluntarily cancel their AFS licences as they were no longer operating a financial service business.
ASIC identified 98 financial advice licensees that still maintained a security bond with ASIC and contacted them to remind them to apply for its release.
“As part of the conditions of release, each licensee had to provide ASIC with evidence of their professional indemnity insurance arrangements,” the statement said.
“Even if licensees were not prepared to apply for the return of their security bond, they were still required to provide evidence to ASIC that they had in place necessary insurance arrangements to comply with Corporations Act requirements,” the statement added.
ASIC deputy chairman Peter Kell said the review assisted ASIC to remove licensees failing to meet their professional indemnity obligations.
“Licensees must ensure they are up-to-date with and actively complying with all current obligations, otherwise ASIC will take further regulatory action, including cancellation of the AFS licence,” said Mr Kell.
Stimulate new ideas. Stimulate new thinking. Top up your CPD points and hear from industry experts with ifa’s Knowledge Centre. Keep up to date with the latest trends and reforms, all while adding to your CPD hours. Explore the Knowledge Centre now.
New female advised clients now outnumber men according to a new report from AUSIEX. ...
Australian Wealth Solutions (AWS) has announced a change of licensee as it heads into a new era. ...
An up-and-coming goals-based advice platform has appointed former executives from Midwinter and Shadforth Financial Group to its ranks. ...