ASIC stands by Responsible Manager process

The Australian Securities and Investments Commission (ASIC) has said that claims that it causes serious delays in “stringently reviewing” responsible manager (RM) appointments by Australian Financial Services Licensees (AFSLs) are “plainly wrong”.

The statement came in response to a blog by the Fold Legal, reported on by this publication, writing that the regulator had no legal obligation to approve RMs and was thus causing headaches for AFSLs by going beyond simply receiving notifications of RM appointments.

ASIC executive director, assessment and intelligence, and regional Commissioner, Victoria, Warren Day said that this was untrue.

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“To set the record straight, in the past three years, ASIC received 1,806 notifications for a change of RMs (new appointments and cessations) that were subject to Licensing assessment. Of these, 90 per cent were approved in 97 days (in 2016), 79 days (2017) and 60 days (2018). A further five per cent where voluntarily withdrawn, and the remaining five per cent raised regulatory issues that warranted longer assessment timeframes,” Day said.

“There is a legal requirement for licensees who have a ‘key person-responsible manager’ condition on their licence to apply for variation to their licence should that person leave the licensee. And ASIC is required by law to assess that application. In addition, there are other criteria relating to a change of responsible manager that also triggered an assessment.

“Far from being a ‘rubber stamp’, ASIC regards an assessment of such changes as a vital safeguard to ensure that licensees have the competence to meet their licence obligations efficiently, honestly and fairly; and the public can have greater confidence on the quality and standards of those in charge of licensees’ operations. ASIC totally rejects any suggestion of ‘over-stepping’, and the increasingly short time taken to consider and finalise these responsible manager changes fully supports this view.”

Day also said that while the regulator hadn’t put out data publicly on this issue in its yearly licensing reports, it would in the future as the industry clearly found the issue important.




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