ASIC has cancelled the Australian financial services licence (AFSL) of NextGen Financial Group.
Effective from 23 February 2024, NextGen’s licence has been cancelled by ASIC.
“The AFS licence was cancelled after the Federal Court of Australia ordered that NextGen Financial Group be wound up in insolvency on 17 November 2023,” the corporate regulator stated.
“Under the Corporations Act, ASIC may suspend or cancel an AFS licence without a hearing if the licensee is under administration or is being wound up.”
NextGen can continue providing a financial service to a client until 16 April 2024 if the person was a client immediately prior to the cancellation of the licence taking effect and if the financial service concerns the termination of an existing arrangement with the client.
NextGen has the right to apply to the Administrative Appeals Tribunal (AAT) for a review of ASIC’s decision.
The case first began when the firm was ordered by the Federal Court in July 2023 to pay an SMSF trustee $270,000 over an unpaid Australian Financial Complaints Authority (AFCA) determination regarding inappropriate financial advice.
In September, the plaintiff in the case, WJ & V Drakoulis Super Pty Ltd, applied for NextGen to be wound up and a hearing was held on 3 October.
As a result, NextGen also saw significant drops in its adviser numbers, losing 23 in two weeks.
The firm formally entered into liquidation in November 2023 after losing the Federal Court case regarding the unpaid AFCA determination.
Following a hearing, a notice from ASIC stated that Joseph Loebenstein of Victoria-based Loebenstein Insolvency Services had been appointed as liquidator by order of the court. The firm is now in liquidation, since 17 November 2023.
