Not all fin services companies need AFS licences: lawyer
Financial services firms concerned about compliance may be better off sharing a licence with other parts of the business, a specialist lawyer says.
While many businesses offering financial services may believe they need their own Australian Financial Services (AFS) licence, this is not necessarily the case, according to The Fold’s senior lawyer, Jaime Lumsden Kelly.
Firms can elect to each carry their own licence or choose one entity to hold the licence and appoint other parts of the business authorised representatives, she said.
“The thing to consider with (the latter) option is which company should hold the licence,” Lumsden Kelly says.
“A holding company that does not itself provide financial services may be a good choice, but it’s not the only alternative.
“When making a decision, you need to be mindful of the fact that the entity that holds the licence will need to undertake monthly cash flow forecasts. They also need to obtain all the authorisations needed for all the financial services offered throughout the group.”
Lumsden Kelly said AFS licences can be a complicated area and companies who are confused should seek legal advice.
Recommended for you
The Australian Financial Complaints Authority has reported an 18 per cent increase in investment and advice complaints received in the financial year 2025, rebounding from the previous year’s 26 per cent dip.
EY has broken down which uses of artificial intelligence are presenting the most benefits for wealth managers as well as whether it will impact employee headcounts.
Advice licensee Sequoia Financial Group has promoted Sophie Chen as an executive director, following her work on the firm’s Asia Pacific strategy.
The former licensee of Anthony Del Vecchio, a Melbourne adviser sentenced for a $4.5 million theft, has seen its AFSL cancelled by ASIC after a payment by the Compensation Scheme of Last Resort.
