ASIC Deputy Chair Peter Kell resigns, effective December 6

It has been announced that ASIC Deputy Chair Peter Kell will resign, effective 6 December.

Mr Kell has been an ASIC Commissioner since November 2011, and Deputy Chair since May 2013. He was reappointed as Deputy Chair for a one-year period from May 2018 by then Minister for Revenue and Financial Services Kelly O’Dwyer.

“His experience and understanding of corporate regulation has been appreciated by successive governments as well as members of ASIC,” said a statement from Treasurer Josh Frydenberg. Read more...

ASIC plans to increase regulatory scrutiny on superannuation

ASIC plans to increase the intensity of its regulatory scrutiny on the superannuation sector, including more shadow shopping.

ASIC Commissioner John Price told a recent conference that the regulator was strengthening its supervision of, and enforcement on, the superannuation sector.

“Another new project we will be implementing is to deliver an enhanced supervisory approach for superannuation. We have already strengthened our team focused on this area,” he said.

This will include building on “public actions in the superannuation sector, including more enforcement outcomes”, and better leveraging new and existing data available to ASIC and APRA. Read more...

ANZ & CBA accept Undertaking over distribution of super products in branches

The ANZ and CBA have reached an agreement with ASIC to change how they distribute some of their superannuation products.

ASIC announced that it has accepted enforceable undertakings from the two banks, following an investigation.

The regulator says it found the banks had a “common practice” of offering their superannuation products – Smart Choice Super for ANZ and Essential Super for the CBA – to customers at the conclusion of a fact-finding process. ANZ called its process an ‘A-Z review’ and CBA called theirs a ‘Financial Health Check’. Read more...

No “systemic” issue of unlicensed accountant SMSF advice: ASIC

ASIC says a review seeking to identify accountants recommending clients set up SMSFs while not holding a financial services licence found “no systemic concerns”.

Though the review did find “significant levels” of inaccurate and out of date information on the websites and in the marketing material of accountants. This seemingly led ASIC to initially target accountants who were then found to be complying with the law.

ASIC says it used a range of information to identify accountants who may have been giving unlicensed SMSF advice, including data from the ATO, AFSL applications, analysis of social media, public advertisements and reports from the public. Another source of information was ASIC’s ongoing project investigating the quality of SMSF advice. Read more...

Spaceship super fund fined by ASIC over misleading investment claims

ASIC has imposed penalties on the promoter and trustee of the Spaceship super fund for misleading claims about its investments.

ASIC announced that $12,600 Infringement Notices have been issued on, and paid by, Spaceship Financial Services Pty Ltd – the promoter of the fund – and Tidswell Financial Services Pty Ltd – the trustee of the fund. These penalties relate to concerns by the regulator about “misleading claims about the ‘fundamental investment philosophy’ of the Spaceship Super Fund’s ‘GrowthX’ portfolio”. Read more...

ASIC asks Court to appoint liquidator for Superfunded

Update: The Federal Court has made orders for Superfunded to be wound up

ASIC Commissioner John Price said: “This case serves as a reminder to consumers approached to set up self -managed super funds, to take care to ensure they are not being drawn into schemes that may involve illegal early access to superannuation.”

ASIC has applied to the Federal Court for a liquidator to be appointed to Superfunded Pty Ltd, a company that the regulator says was unlawfully carrying on a financial services business involving recommending the set up of SMSFs. Read more...

Advising super consolidation leads to 5 year exclusion from industry

Financial Literacy Australia will be receiving $400,000 as part of an Enforceable Undertaking accepted by ASIC in connection with a business that advised people to consolidate their superannuation.

ASIC announced that it has accepted an Enforceable Undertaking from David Orth, who was the director of Real Wealth Pty Ltd. Part of the Undertaking involves him not providing financial services for five years.

ASIC says that Mr Orth developed and implemented a business model under which “representatives of Real Wealth would offer to assist clients complete a lost superannuation search and then make representations to them about the advantages of consolidating their existing superannuation funds into a single superannuation fund, and the returns on that fund.” Read more...

Over $7 million in penalties for ‘fast cash’ linked to super advice

The Federal Court has ordered three companies pay penalties totalling $7,150,000 in connection to “numerous contraventions of financial services and consumer protection laws”, involving offering ‘fast cash’ linked to superannuation and insurance advice, ASIC has announced.

ASIC said the companies advertised ‘fast cash’ to consumers with poor credit histories and then required them to receive and implement financial advice – switching their superannuation and taking out “high end” insurance. Advice fees were charged, and paid out of the consumers’ superannuation. Upfront insurance commissions were used to provide a ‘cash rebate’ to clients. Read more...

Adviser agrees to two year exclusion due to SMSF switching advice

A financial adviser has agreed to exclude himself from the industry for at least two years, under an Enforceable Undertaking with ASIC, following from SMSF switching advice.

ASIC announced that James Barry Fraser, formerly an adviser with MyPlanner Australia Pty Ltd, agreed he will not provide financial services for at least two years. If he wishes to re-enter the industry after this time he will need to complete additional SMSF training and adhere to supervision requirements.

A review of his client files by ASIC found that he failed to act in the best interest of some clients by advising them to set up SMSFs and switch existing super an insurance into those funds “without appropriate consideration of the clients’ existing arrangements”. ASIC also says he “failed to disclose information about relationships with external parties, or the remuneration agreements with those parties that would capable of influencing the advice” and failed to provide Statements of Advice. Read more...

ASIC accepts Enforceable Undertaking over ‘one size fits all’ SMSF firm

ASIC has accepted an Enforceable Undertaking in relation to a firm using a ‘one size fits all’ SMSF advice model.

The regulator announced that it had accepted an Enforceable Undertaking (EU) from AIW Dealer Services Pty, which was the financial services licensee of Otium Advice Pty Ltd – a financial advice business based on the Sunshine Coast.

“ASIC’s surveillance found that Otium advisers had used a ‘one size fits all’ advice model, advised clients to switch superannuation funds when it was inappropriate to do so and failed to demonstrate the ability, professional skills and knowledge required to competently provide financial product advice,” said ASIC. Read more...