The corporate regulator has confirmed to ifa it intended to cancel the AFSL of non-bank dealer group Dover Financial prior to Friday’s sudden closure.
ASIC intended to cancel Dover’s licence due to compliance issues with the licensee that have not yet been made public, an ASIC spokesperson told ifa.
It is understood Dover wanted to continue trading for a longer period, however the decision to abruptly close the licence last week was made by the licensee rather than the regulator.
ASIC also released further guidance for affected advisers, their clients and licensees looking to on-board ex-Dover personnel.
“In the past, ASIC has warned AFS licensees to ensure they have robust recruitment and monitoring when appointing advisers who have worked for a licensee with a poor compliance history,” the guidance said.
It also said that “any licensee considering authorising an ex-Dover adviser” should make arrangements to address any deficiencies in the advice given by ex-Dover advisers, and “have heightened oversight (for instance, vet all advice from ex-Dover advisers for a period)”.
“When hiring a new adviser ASIC suggests that, at a minimum, licensees receive audit reports and/or reference checks from the previous licensee. In the case of ex-Dover advisers, you should get audit reports and/or a reference from the licensee before Dover and/or do other assessments of the person's competence,” the guidance said.
This guidance followed an initial statement from the regulator acknowledging an ongoing investigation into Dover that commenced in 2017.
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