Additional licence conditions imposed on financial advice firm
Inadequate risk controls and poor supervision has led to the corporate regulator imposing conditions on a financial advice firm.
ASIC has imposed additional conditions on the Australian financial services (AFS) licence of Poynter Hargraves Financial Consultants Pty Ltd (Poynter Hargraves).
This follows a targeted surveillance by ASIC that found Poynter Hargraves had poor risk controls around conflict management and was not adequately monitoring and supervising its representatives.
ASIC said its surveillance also found that some clients were provided with financial advice that failed to meet the best interests duty and related obligations.
“The additional licence conditions require Poynter Hargraves to engage an independent expert to review and make recommendations on how its audit processes and conflict management can be improved,” ASIC stated.
“The independent expert must also pre-vet a sample of advice and report on the effectiveness of the improvements made by Poynter Hargraves.”
Poynter Hargraves will also be required to remove its sole responsible manager and appoint one or more responsible managers with the necessary skills and experience.
“ASIC expects licensees to have robust controls in place for managing conflicts of interest and adequate audit processes to monitor and supervise their representatives,” the regulator stated.
“AFS licensees should conduct sufficient periodic audits of all their advisers and use suitably qualified staff to conduct these audits.”
Tony Zhang is a journalist at Accountants Daily, which is the leading source of news, strategy and educational content for professionals working in the accounting sector.
Since joining the Momentum Media team in 2020, Tony has written for a range of its publications including Lawyers Weekly, Adviser Innovation, ifa and SMSF Adviser. He has been full-time on Accountants Daily since September 2021.