A Menai-based insurance broking firm has had its licence suspended for seven months following surveillance conducted by the Australian Securities and Investments Commission (ASIC).
ASIC found that Southport Insurance Brokers Pty Ltd breached several legal obligations and licence conditions.
The practice failed to maintain sufficient base level financial requirements to pay all debts "as and when they become due" and to hold at least $50,000 in surplus liquid funds when holding client money, among other breaches, according to ASIC.
"People look to insurance brokers, like other financial service providers, for help in securing services with which they are often unfamiliar, and in doing so place significant trust in those professionals," said ASIC Commissioner Peter Kell.
"Clients should have confidence that such gatekeepers are fully complying with their legal obligations and the conditions of their Australian Financial Services Licence when dealing with their money," Kell added.
Southport now has the option of appealing to the Administrative Appeals Tribunal for a review of ASIC's decision, though the regulator might revoke the suspension if the firm remedies the concerns identified by the regulator.
