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ASIC accepts enforceable undertaking from advice firm

18 May 2016 — 1 minute read

An advice firm in NSW has agreed to cancel its AFS licence after surveillance undertaken by ASIC identified concerns regarding whether advice given to clients to establish SMSFs was appropriate.

In a public communication, ASIC announced it has accepted an enforceable undertaking from Ascentiv Group Pty Ltd, based in Mascot, NSW, and its sole director Chris Pappas.

ASIC surveillance of Ascentiv identified concerns in relation to Ascentiv's failure to ensure its representatives provide SMSF advice that was appropriate and in the best interests of the clients and adequately manage conflicts of interest, the corporate regulator said.


The surveillance also identified concerns regarding the firm’s failure to adequately monitor and supervise its representatives and ensure its representatives were adequately trained and competent to provide SMSF advice.

"ASIC's surveillance also found that Ascentiv failed to provide its clients with clear and concise statements of advice," ASIC said in the statement.

"Instead, the statements of advice were very lengthy and difficult to understand, making it difficult for Ascentiv's clients to make informed decisions about the advice provided to them."

Under the EU, Ascentiv has agreed to cancel its AFS licence and write to some of its existing clients to inform them of the EU and the clients' rights to dispute resolution, ASIC said.

Mr Pappas has also agreed to give a copy of the EU to any AFS licensee that authorises him to provide financial services in the future and complete further SMSF specialist training before becoming a representative of an AFS licensee, according to ASIC.

He will also refrain from becoming an AFS licensee or office holder of an AFS licensee for two years.

ASIC deputy chairman Peter Kell said SMSFs are not appropriate for everyone and that it is important that the advice provided to clients of financial advisers is appropriate for those individuals' needs and circumstances.

"ASIC further expects that AFS licensees that provide SMSF advice to adequately monitor their representatives and have processes which lead to the provision of high-quality SMSF advice," said Mr Kell.

"ASIC will intervene where it finds the quality of advice provided by advisers and the supervision of those advisers by the licensee to be lacking."


ASIC accepts enforceable undertaking from advice firm
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