ASIC has imposed additional licence conditions on Australian Financial Services Limited (AFS) following a six-month surveillance operation.
This additional regulatory requirement has seen AFS appoint Holly Nethercote as an independent expert to review and make recommendations regarding its compliance practices, processes and resources.
Peter Daly, group CEO and managing director of AFS says ASIC had approved the selection of Nethercote and that the process of reviewing compliance procedures and tabling recommendations would take “a few weeks”.
A spokesperson for ASIC says the review process, including the implementation of recommendations, will be ongoing over the next 13 months.
The surveillance included a review of client files to examine the appropriateness of advice given and looked at the management of conflicts of interest and complaints handling.
ASIC Chairman, Greg Medcraft, said in a statement that investors must be able to confidently rely on the accuracy and appropriateness of information provided by financial advisers.
“All Australian financial services licensees are gatekeepers and are expected to properly manage and supervise their representatives and employees and make sure conflicts of interest are managed or avoided and client complaints are dealt with promptly,” he said.
ASIC’s surveillance identified a number of concerns including AFS’s management of conflicts of interest relating to advice provided to clients to switch their investments to financial products associated with and/or related to the licensee.
ASIC acknowledged AFS’s cooperation in voluntarily offering to engage an independent expert and their commitment to improving compliance with its licence conditions.
