ASIC tightens approach on EUs
The Australian Securities and Investments Commission (ASIC) has confirmed it is tightening its processes around enforceable undertakings in the wake of the Commonwealth Financial Planning and Macquarie Private Wealth experiences.
ASIC chairman, Greg Medcraft used his opening address to a Parliamentary Joint Committee on Friday to make clear that recent events had prompted the regulator to change its approach to ensure that the drafting of enforceable undertakings would tighter and the monitoring "more independent and effective".
"We will also be transparent about the outcome of that monitoring," he said.
Medcraft claimed that ASIC had been willing to examine and learn from its experiences.
The ASIC chairman was also quick to reassure the parliamentary committee that the regulator had not been idle with respect to the fact that the recent report of Senate Committee inquiring into ASIC had raised the issue of Macquarie Private Wealth (MPW) and its advice to clients.
"There have been developments in this area. In mid-August, ASIC announced that Macquarie Equities Limited (MEL) would write to around 160,000 clients — past and present — about possible remediation for flawed financial advice. The advice was from Macquarie's adviser network, MPW," he said. "This remediation is part of ASIC's January 2013 EU with MEL, which was the result of surveillance that identified concerns about MPW's compliance processes and its risk framework."
"The EU requires MEL to identify advisers with poor compliance. Where MEL identifies a client has been affected, MEL must remediate the client, including compensation. The remediation will be subject to additional independent scrutiny by accounting firm Deloitte. It will report to MEL and ASIC," Medcraft said.
Recommended for you
Financial advisers and wealth managers need to exceed their clients’ desires for personalisation, a new EY report writes, and the requirements for this will vary between client segments.
Betashares chief executive, Alex Vynokur, believes technology advancements will enable banks to return to financial advice in the future as the need for advice is greater than ever.
Centrepoint Alliance has upgraded its expected financial results for FY24, thanks to strong adviser recruitment and the acquisition of Queensland advice firm Financial Advice Matters.
The corporate regulator has permanently banned a Melbourne-based financial adviser that “dishonestly attempted to induce clients to transfer their superannuation into a bank account he controlled”.
