ASIC sharpens focus on REs
The Australian Securities and Investments Commission (ASIC) has proposed tightening up on the responsible entity (RE) arrangements around managed investment schemes (MIS).
The regulator has issued a consultation paper in which it sought industry feedback on restricting guarantees and indemnities granted to responsible entities, requiring the REs to create rolling 12-month cash flow projections, increasing the net tangible asset capital requirements for the REs and specifying the net tangible asset liquidity requirements for REs.
Development of the ASIC consultation paper comes in the wake of the collapse of a number of agricultural investment schemes and recent judicial decisions, which have suggested inherent conflicts of interests with respect to the control of the schemes and the control of the ME.
Commenting on the discussion paper and its proposals, ASIC Commissioner Greg Medcraft pointed out that the financial requirements for REs had not been reviewed since the implementation of financial services reform in 2002.
“In producing the consultation proposals, ASIC has set out to ensure sufficient rigour in the operating risk framework that applies to businesses that seek to manage money on behalf of members,” he said.
Recommended for you
With the highest number of candidates in a year sitting the latest financial advice exam, a surge of new entrants are expected in the coming weeks, according to Wealth Data.
AMP has launched a range of five diversified index managed portfolios on its North investment platform, targeting a younger client demographic.
An NSW adviser, who advised over 120 clients after falsifying her financial advice exam results, has been permanently banned by ASIC.
ASIC has released the results from the latest financial adviser exam, the first to be run since changes to its structure earlier this year.