Failure to provide SOAs leads to ASIC court enforceable undertaking
The Australian Securities and Investments Commission (ASIC) has accepted a court enforceable undertaking from financial advisory firm Lasarith Pty and its sole director for failure to provide Statements of Advice (SOA).
Lasarith, which traded as Succession Matters, would cease operating under its Australian Financial Services licence and commence the process to cancel it by 8 February, 2023.
Sole director and responsible manager, Adam Smith, also agreed to conduct further professional training and not to be a responsible manager of any other AFSL holder for a period of at least 18 months from 10 November, 2022.
The matter followed an ASIC investigation after concerns he was failing to provide SOAs to clients as required by the Corporations Act.
It found:
- A least 24 occasions during the 2016/17 and 2017/18 financial years when Lasarith and its authorised representatives failed to provide a statement of advice to clients in accordance with s946A of the Corporations Act; and
- At least 30 occasions during the 2016/17 and 2017/18 financial years when Lasarith and its authorised representatives failed to provide a statement of advice to clients within the period specified in s946C of the Corporations Act.
Smith also:
- Failed to take sufficient action to prevent breaches of the Corporations Act from occurring, until September 2017; and
- Failed to cause Lasarith to notify ASIC of the breaches until September 2021; and
- Did not fulfill all of his obligations as the responsible manager of Lasarith during the 2016/17 and 2017/18 financial years.
ASIC generally required a court enforceable undertaking contained admissions that the party providing the undertaking contravened legislative provisions.
AUTHOR
Laura Dew
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