ASIC cracks down on adviser licensing

Alex Burke,  Senior Writer,  No More Practice Education

As part of a desire to "ascertain whether [a licensee] has reason to believe an applicant is likely to contravene its legislative obligations," ASIC is now requiring AFSL applicants to provide additional information.

For the purposes of this piece, we'll focus on financial advisers, covered under "applicants that are proposing to offer certain financial services or to operate in specific circumstances." Note that these requirements apply to both prospective licensees and those looking to vary their licenses.

Commenting on the changes, ASIC's executive director - assessment and intelligence, Warren Day, said: "ASIC has reviewed the AFS licence assessment processes and has streamlined its assessment processes in some limited respects."

"This is designed to avoid unnecessary delays that may arise when ASIC seeks additional information during an assessment," he added.

So, what's changed?

Providers of personal financial product advice

Those looking to apply for or vary their AFSL will now also need to provide documentation concerning compliance arrangements, a program for monitoring, supervision and training of authorised representatives and a risk management system statement.

Those looking to deal in managed discretionary accounts (MDAs) will also need to provide both evidence of compliance arrangements and a risk management system statement, along with an MDA operator capacity statement and arrangements for managing conflicts of interests.

Other required proofs

Other circumstances where licensees may be required to provide non-core proofs include where an applicant has nominated a responsible manager who is an officer of another AFS licensee. In this case, the applicant will need to provide proof of arrangements for managing conflicts of interests, which will have to "include specific details about the arrangements for managing the responsible manager's conflicts of interest that arise because of their various roles."

Where an applicant seeks to outsource a "material activity required to provide the financial service or product," they will need to provide an outsourcing statement.

If you'd like to see the full list of additional information required for applicants, you can do so here.


The opinions expressed in this content are those of the author shown, and do not necessarily represent those of No More Practice Education Pty Ltd or its related entities. All content is intended for a professional financial adviser audience only and does not constitute financial advice. To view our full terms and conditions, click here.

 

Liked this article? Let us know

Want more of the latest in opinions, expert insights and training?

Subscribe to our free eNewsletter now

/ Related content

Remuneration changes will cripple the industry

A new report suggests further changes to adviser remuneration will cause....

How the Royal Commission spurred a new FPA program

It's come about due to the amount of scrutiny placed on the profession a....

Why do a third of advice clients want to switch providers?

New global research dives into the way customer demands are shifting. <....

Leave a comment /

Related content /

06 June, 2019

Alex Burke,Senior Writer,No More Practice Education

Remuneration changes will cripple the industry

A new report suggests further changes to adviser remuneration will cause more problems than they’re intended to solve.

Read now

04 June, 2019

Alex Burke,Senior Writer,No More Practice Education

How the Royal Commission spurred a new FPA program

It's come about due to the amount of scrutiny placed on the profession and the pressure from new education requirements.

Read now

28 May, 2019

Alex Burke,Senior Writer,No More Practice Education

Why do a third of advice clients want to switch providers?

New global research dives into the way customer demands are shifting. 

Read now

WordPress Lightbox Plugin