First cab off the rank with AFS licence

TheAustralian Securities and Investments Commission(ASIC) has issued its first ever license under the Financial Services Reform Act (FSR), with the first cab off the rank being Terri Scheer Insurance Brokers.

The Australian Financial Services (AFS) licences are required of financial services companies under the FSR legislation which became enacted yesterday.

“We issued our first AFS licence to Terri Scheer Insurance Brokers, who applied using eLicensing, our online application system,” ASIC executive director FSR, Ian Johnston, says.

ELicensing is available on ASIC’s Web site and is designed to cut the processing time and costs involved from conventional paper applications.

ASIC claims applying online can reduce the application fee by 50 per cent. ASIC says a failure to read and understand its guidelines on the application process will increase the time needed to apply.

“We’ve received applications from individuals as well as organisations so far, and we have some concerns that people are applying without reading our Licensing Kit or policy,” Johnston says.

“Granting an AFS licence isn’t a “rubber stamp” process. There is a stringent assessment involved and applicants need to be aware that if their application is incorrect or incomplete, it will be sent back to them.”

While a transitional period of two years has been granted for companies to comply with the new legislation, ASIC has already warned that leaving the licence-application late could impact severely on the time in which ASIC could turn the application around, particularly if a large number of other companies are in the same boat.

In unrelated news from ASIC, a fund manager which was appointed a receiver and had its assets frozen by the securities watchdog has won a reprieve in the New South Wales Supreme Court.

Sage Global Fund has been allowed by the Supreme Court to remove an interim receiver and to lift the freeze on its assets, after having these conditions imposed on it and its major shareholder, Australian Investors Forum (AIF), by ASIC last November.

The Court came to its decision after Sage removed Dominic Luvara and Martin Lloyd-Cocks from its board of directors. ASIC originally alleged that Australian Investors Forum and a number of related individuals including Lloyd-Cocks, had engaged in conduct in breach of the Corporations Act. ASIC’s proceedings also included Sage.

ASIC’s proceedings against the companies and individuals are continuing.