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Review into Financial Advice Compliance

October 15, 2018

 

 

Earlier this week the Australian Securities and Investments Commission (ASIC) announced a review into the in the fee disclosure statements and the Renewal notices in the financial advice sector.

 

ASIC said that they will also be looking at systemic non-compliance and will be undertaking a project to test the compliance with FDS and renewal notices.

 

 The regulator said that they are currently investigating breaches with the intention of taking enforcement action.

ASIC is also responsible for the ongoing remediation programs which require breaches to be reported by the licenses and compensate affected consumers.

 

ASIC said earlier this week that they received ‘a number’ of breach reports that indicate that have been failures to comply with the Future of Financial Advice (FOFA) reforms that were made in 2013.

 

 A list of issues that ASIC will be investigating:

  • issue FDSs and Renewal Notices to customers;

  • issue FDSs and Renewal Notices within the timeframes set out by the law;

  • include the required content in the FDSs;

  • ensure the content of FDSs is accurate, for example, in describing what customers are charged for and what services customers have received;

  • have appropriate procedures in place to ensure fees for ongoing services are discontinued when the arrangements are terminated as a result of licensees failing to comply with the FDS or Renewal Notice requirements.

After the review, has been conducting the corporate regulator said that they will release their findings in 2019.

 

It will be to wait and see if the publishing of these findings will coincide with the final report of the Royal Commission.

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