Danielle Press

The corporate regulator has released guidance regarding the functions and processes of its Financial Services and Credit Panel, including the rights of advisers who are called to a convened session and the contraventions that may lead to it.

ASIC previously announced its parameters for warnings and reprimands but, in guidance released on Wednesday afternoon, added it “will consider whether misconduct is widespread or part of a growing trend, and whether referring the matter to a sitting panel will send an effective and deterrent message to industry”.

ASIC will maintain full discretion over matters it will investigate and will “carefully consider” how it will respond to reports of situations that fall under its remit.

“However, we cannot investigate or take action in relation to every such report,” it stated. “Instead, we will be selective about the matters we pursue to ensure that we use our resources to target misconduct effectively and efficiently.”

Insolvency, fraud, not a fit and proper person, failure to approve a statement of advice, provision of personal advice by an unregistered financial adviser, and serious contravention of a financial services law make up most potential infractions.

These contraventions, at most, could result in ASIC accepting an enforceable undertaking from a financial adviser as well as suspending or restriction an adviser from being registered.

Additionally, a breach of education and training standards at maximum could result in ASIC issuing civil penalty proceedings against the financial adviser.

The panel

When a matter has been decided if it will be put in front of a panel, the regulator will nominate an internal and at least two external members of the FSCP.

ASIC announced its inaugural panel roster earlier in the year after it had been picked up the names were yet to be public despite the regime having officially begun.

“Where appropriate, we may convene the same sitting panel to hear a number of similar matters together to ensure that the sitting panel operates as efficiently as possible,” the guidance stated. “However, even where the same sitting panel considers several different matters, each matter will be considered separately and on its own merits.”

ASIC stated each panel member must give written notice regarding all conflicts of interest that could be a factor if selected for a trial.

“Using the declarations provided by external members and other information available to ASIC, we will undertake checks for conflicts of interest before appointing external or internal members to a sitting panel.”

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