ASIC to focus on advice risks for 2017
ASIC has released its six-month enforcement report, which sets out the number of individuals removed from the financial services industry as well as the regulator’s focus for the remainder of the year.
According to the report, which outlines enforcement results achieved from 1 July to 31 December 2016, ASIC has removed 39 individuals from the financial services industry, up from 27 people in the previous corresponding period.
The regulator has also secured $159.4 million in compensation as well as laid 47 criminal charges, the report states.
One of the key risks ASIC focused on in the six-month period related to culture and incentives that result in poor financial advice, irresponsible lending and mis-selling to retail investors and consumers.
For the remainder of the year, ASIC said it will continue to focus on enforcing higher standards in the financial services industry and pay particular attention to financial advisers’ compliance with best interests duty and obligations.
The regulator will also watch for any licensee failure to deliver ongoing advice services to customers who are paying fees to receive the services.
Further, ASIC will look for instances where licensees claim to provide general advice to retail clients during the sale of financial products, but are actually providing personal advice and not complying with the best interest duty and related obligations.
“ASIC’s Wealth Management Project will continue to be a focus for our enforcement activity. The project seeks to improve the standards of major financial advice providers in terms of quality of advice and remediation,” the report states.
“We intend to build on the significant number of investigations and surveillances we have undertaken within this project in the last six months, which have resulted in a number of key outcomes.”
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