AAA to have PI insurance for another year
The Australian Securities and Investments Commission (ASIC) has made sure AAA's planners are covered by requiring the dealer group to hold its professional indemnity (PI) insurance policy until 29 January, 2014.
Money Management obtained a letter ASIC sent to AAA's authorised representatives, who will have to find a new home by the end of this month after the regulator cancelled the dealer group's Australian Financial Services Licence (AFSL).
In cancelling the licence, ASIC ordered the AFSL maintain a compliant external dispute resolution (EDR) scheme and arrangements for compensating retail clients (PI insurance) until 29, 2014.
"It is imperative that you obtain confirmation from AAA that it remains a member of an EDR scheme and also has in place an adequate and responsive PI insurance policy, if you provide or intend to provide financial services up until 28 February, 2013," ASIC said in a letter to AAA authorised representatives.
"If you are not able to obtain confirmation from AAA that these arrangements are in place, you must not provide financial services to retail clients."
The Administrative Appeals Tribunal made an order that provides AAA planners with temporary AFSL coverage until 28 February, 2013 after which they will have to either find a new licensee or obtain their own.
ASIC requested that all the authorised representatives write to their clients and advise them of the action the regulator has taken in respect of AAA and how it affects financial services provided to them.
Suncorp recently confirmed to Money Management that its dealer group Guardian Advice might provide refuge to a few "high quality planners" coming from AAA.
Meanwhile, the Financial Planning Association's (FPA's) legal team has asked AAA Shares to take down a page claiming the dealer group's affiliation with the FPA and the Certified Financial Planner status of some of its planners. As of this morning, the page seems be offline.
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Staff Writer
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