ASIC warning to licensees: Be wary of dodgy recruits

by AB07 May 2013
“However, where representatives have come from an environment in which there was a culture of poor compliance or poor quality advice, appointing licensees need to take extra care to satisfy themselves that representatives are properly trained and monitored to address early any issues that might arise.”

“ASIC urges all licensees to review their current approach to appointing representatives and make sure processes are robust. Licensees must have in place adequate compliance and governance standards. This includes being responsible for the conduct of representatives they appoint.”

Kell says licensees must:

  • Ensure migrating representatives are competent and adequately trained. It is important that they are effectively screened and their background checked;
  • Have adequate supervisory arrangements in place to identify and address deficiencies quickly, and
  • Have adequate financial, technological and human resources to supervise and monitor new representatives, especially in cases of business growth.

“Monitoring and supervision are much more than audits and compliance checks. They are about proactively ensuring that advice is appropriate and clients are treated fairly,’ he adds. “ASIC is continuing to closely scrutinise licensees’ obligations to demonstrate adequate monitoring and supervision and will not hesitate to take action where we find those practices deficient.”

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  • by SIDBROKER 7/05/2013 2:04:17 PM

    Why would any broker risk new comers when they are responsible and potentially liable for them.