ASIC structured product focus moves from licensees to planners
The Australian Securities and Investments Commission (ASIC) may take enforcement action against individual financial planners who provided advice on complex products after it reported that 10 licensees, including Count Financial and Genesys Wealth Advisers have been involved in taking corrective action around advice related to those products.
In December 2013 ASIC released a report which examined the advice provided by 10 licensees in the area of retail structured products.
The regulator stated it was concerned that products labelled as 'capital protected' or 'capital guaranteed' were being advised upon without adequate consideration of client’s needs and circumstances.
In a statement today ASIC said it was updating the public about its own actions and that of the licensees since December 2013 which had resulted in a wider review of advisers and clients by the licensees as to whether there were further breaches and if client, adviser and licensee remediation was required.
ASIC stated that two licensees - Meritum Financial Group and Sentry Financial Services – notified the regulator of significant breaches to ASIC with Meritum terminating the
the authorisations of a corporate authorised representative and two individual authorised representatives.
Both groups have contacted clients involved and are assessing whether client compensation is required and are working with ASIC on whether further regulatory action is required.
ASIC stated that nearly 1000 clients who received advice will have their file reviewed and while it finalised matters relating to advice from the licensees during 2014 it was monitoring ‘several other matters’ and would take enforcement action against advisers where inappropriate advice was provide.
The licensees who have taken corrective action are: Consultum Financial Advisers, Count Financial, FSS Advisory, Genesys Wealth Advisers, HSBC Bank Australia, Madison Financial Group, MASU Financial Management, Meritum Financial Group, Sentry Financial Services and Westpac Banking Corporation.
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