Single disciplinary body the Financial Services and Credit Panel (FSCP) has published its first outcome, relating to an adviser who impersonated a client on the phone.
The body commenced operations last year as part of the Financial Sector Reform (Hayne Royal Commission Response – Better Advice) Act 2021 and fell within the Australian Securities and Investments Commission (ASIC) as the single disciplinary body for financial advisers from 1 January 2022.
Its first outcome related to an action by a relevant provider who impersonated a client during telephone conversations with a bank to facilitate a transaction.
Although the adviser did not obtain any benefit from the transaction, the sitting panel determined the adviser had contravened the Corporations Act 2001.
As a result, the body directed the relevant provider to provide a copy of three successive compliance audits undertaken by their licensee in relation to personal advice they had given to retail clients, with a minimum of 12 months between each successive audit, commencing in 2023, within 30 days of 30 June of the relevant year.
The adviser was anonymous on the outcomes register, but this would not apply if the panel’s decision was required to be reported on the Financial Advisers Register (FAR).
The difference between complaints referred to the FSCP and those referred to the Australian Financial Complaints Authority (AFCA) is that those dealt with by AFCA related to consumers who had suffered financial losses while the FSCP dealt with misconduct.
There were varying levels of action that the FSCP could take, depending on the severity of the case, ranging from warnings/reprimands, directions to undertake training or counselling, suspending an adviser’s registration, infringement notices, issuing civil penalty proceedings, and enforceable undertaking.
Speaking last month at the FAAA United Association Roadshow in Sydney, Leah Sciacca, ASIC senior executive for financial advisers, said: “We do not, and cannot, investigate every instance of possible misconduct that comes to our attention. We have sophisticated processes to support us in deciding when to take action.
“At a macro level, these processes help us set strategic priorities and formulate our corporate plan. At a micro level, they guide our assessments of individual matters, including reports of alleged misconduct.”
