ASIC pursues former Macquarie advisers
The Australian Securities and Investments Commission (ASIC) will be investigating former financial advisers with the Macquarie group which will in turn contact 160,000 clients about the possible provision of remediation for flawed financial advice.
ASIC stated Macquarie Equities Limited (MEL) would begin contacting former and current clients from today as part of the enforceable undertaking (EU) imposed on Macquarie Equities in January 2013.
The EU which resulted from the regulator’s surveillance of Macquarie Private Wealth (MPW), which provided advice to MEL clients, and the identification of concerns about MPW's compliance processes and its risk framework.
Under the EU MEL is required to identify advisers with poor compliance and where a client has been affected due to a failure of advice must remediate the client, including compensation.
The 160,000 clients set to receive letters will be asked to raise any concerns regarding the advice they received with letters to be sent to people who have been clients at any time since MEL obtained its AFSL on 1 March 2004.
The EU, which is scheduled to run until January 2015, is being overseen by KPMG which is acting as an independent expert with the Deloitte overseeing the remediation process and reporting to ASIC and MEL.
“This remediation process will allow clients who believe they have been given poor advice to raise their concerns with Macquarie Equities. Clients who have suffered financial loss due to bad advice must be properly compensated,” ASIC Deputy Chairman Peter Kell said.
“ASIC expects to see significant change at Macquarie and we are determined to ensure that they improve their compliance to meet the standards the community expects of the financial advice sector.”
The recent Senate Inquiry into the Performance of ASIC made reference to the regulator’s work with MEL and MPW and recommended that ASIC ensure there were no other compliance deficiencies, make public the findings of its surveillance and provide a report to the committee on its actions.
AUTHOR
Jason Spits
Recommended for you
Shadow financial services minister Luke Howarth has stressed the Coalition’s commitment to reforming the CSLR, adding that he ultimately wants to “get rid of it”.
With just over three weeks until the federal election, the FAAA has put a reduction in red tape and further support for new entrants on its priority list for an incoming government.
The corporate regulator has issued infringement notices to three AFSLs whose financial advisers provided personal advice to a retail client while unregistered.
Rather than taking a controlling approach, the latest generation of overseas private equity deals is helping advice firms to achieve their growth ambitions, three commentators have said.
