Former national advice business sees AFSL cancelled
ASIC has cancelled the Australian financial services licence (AFSL) of former national financial advice business, Libertas Financial Planning.
Libertas went into liquidation in May 2023 and applied to exit the Australian Financial Complaints Authority (AFCA) in June 2024 although it remains a member for now and AFCA will consider its expulsion at its next board meeting on 5 September. ASIC cancelled the AFSL on 14 August.
Libertas, which was acquired by Sequoia Financial Group in August 2019, went into liquidation in May 2023. In a statement at the time, Sequoia said it planned to consolidate AFS licences, with management making the decision to transfer Libertas’ operations and customers to InterPrac Financial Planning and Sequoia Wealth Management.
The former dealer group is now managed by an external company.
An AFCA determination had previously been made against Libertas on 24 July 2023, but this was not paid by the firm. As a result, the Compensation Scheme of Last Resort (CSLR) paid an unspecific amount of compensation to the person on 24 July 2024 and notified ASIC which prompted the cancellation.
This is the first time that ASIC has cancelled an AFSL following a payment of compensation by the CSLR.
Under CSLR rules, where the CSLR pays compensation to an eligible consumer in relation to an AFCA determination and notifies ASIC of the details of the firm that failed to pay the compensation, ASIC must cancel the AFSL of the firm.
The CSLR can pay up to $150,000 in compensation to consumers who have an unpaid determination from AFCA relating to authorised personal financial advice, credit intermediation, securities dealing or credit provision, and where other eligibility criteria are met.
All reasonable steps to obtain compensation from the financial firm must be taken before a CSLR payment can be made.
The cancellation is not subject to discretion or merits review, ASIC said.
AUTHOR
Laura Dew
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