Bridges SOA audit demanded despite earlier clean-up
The corporate regulator is standing by its decision to ask Bridges Financial Planning to conduct an external audit of its compliance procedures, despite claims by Bridges that the related errors were fixed up six months ago.
The request to conduct the audits occurred as a result of the Australian Securities and Investments Commission (ASIC) identifying a failure by seven Bridges advisers to disclose, in writing, information about charges and benefits in Statements of Advice (SOA).
The errors were identified last November as part of ASIC’s super switching campaign.
ASIC director of enforcement Jan Redfern confirmed that Bridges had begun to address the issues as early as February this year.
“Yes, they told us that they had rectified the issues and there were further improvements made, but we wanted to see an independent assessment of that and if that assessment clears them, then we’re satisfied,” she said.
“[rectifying errors] is the licensee’s obligation, so why shouldn’t they provide us with evidence that it has been done,” she said.
A spokesperson for Bridges holding company, Australian Wealth Management, said Bridges identified the related errors as part of an internal review initiated soon after communicating with ASIC last November.
Following the review, corrected SOAs were released by Bridges in March.
“Then in June, ASIC raised concerns and we told them we’d already picked up the problem immediately. So, yes, there was a problem, but we had proactively fixed it before they came to see us,” the spokesperson said.
Redfern said ASIC interviews with affected clients earlier in the year showed they had not suffered any financial loss and that they had only been given the information missing in the SOAs orally.
She went on to stress the importance of advisers including information regarding charges and benefits inherent in superannuation funds in an SOA.
“This isn’t just a small technical issue. When you’re switching funds, charges need to be clearly disclosed to a client so they can make important comparisons” Redfern said.
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