ASIC tightens conditions for dealers
The Australian Securities and Investments Commission (ASIC) has add further conditions to the dealer’s licences held by two financial planning groups.
The conditions imposed upon the planning arms of Pacific General Securities Limited and Trust Company of Australia Limited were consistent with those ASIC rolled out in May this year.
At that time the regulator said it would publish notices of special conditions being imposed to assist the financial planning industry and notify the public regarding the action taken by ASIC.
ASIC says it has released the special conditions regarding Pacific General, also trading as Wealthy & Wise, after ASIC conducted routine surveillance and found in some case the group’s adviser’s may not determine fully or consider the risk tolerance of some clients when making recommendations relating to investment products.
Other concerns of ASIC include whether the group had appropriate monitoring and compliance reviews of advisers and if the advisers correctly disclosed to their client the commissions they received.
ASIC also reviewed the Trust Company and in particular its’ licence as the regulator was notified that clients may have received advice from planners under Trust Company’s control but did not have an authority to do so.
Both groups have agreed to work with ASIC and will appoint an independent consultant to examine compliance monitoring of advisers. The consultant will report to ASIC regarding the effectiveness of the compliance systems within the two groups who must act to any appropriate findings.
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