ASIC has accepted a court enforceable undertaking from the financial advisory firm Lasarith and its sole director and responsible manager, Adam Smith, after an investigation was launched over concerns Statements of Advice were not being provided to clients.

Under the terms of the undertaking, Lasarith, trading as ‘Succession Matters’, will cease operating its financial services business under its Australian financial services licence and begin cancelling it by 8 February 2023.

Smith must also conduct further professional training and not be a responsible manager of any other AFSL holder for at least 18 months.

The undertaking comes after ASIC found that Lasarith and its authorised representatives failed to provide a statement of advice to clients on several occasions between 2016 and 2018.

ASIC’s investigation subsequently identified:

  • At least 24 occasions during FY17 and FY18 when Lasarith and its authorised representatives failed to provide an SOA to clients in accordance with s946A of the Corporations Act; and
  • At least 30 occasions during FY17 and FY18 when Lasarith and its authorised representatives failed to provide an SOA to clients within the period specified in s946C of the Corporations Act.

ASIC also found that Smith:

  • Failed to take sufficient action to prevent breaches of the Corporations Act from occurring until September 2017;
  • Did not notify ASIC of the breaches until September 2021; and
  • Did not fulfil all of his obligations as the responsible manager of Lasarith during the 2016/17FY17 and 2017/18 financial yearsFY18.

Court-enforceable undertakings are only sometimes used as an alternative to other enforcement actions. They can be used to complement or enhance such actions.