ASIC examining wholesale/retail client definitions
The Australian Securities and Investments Commission (ASIC) has confirmed it is continuing to examine the misclassification of wholesale and retail clients.
ASIC chair, James Shipton has confirmed to a Parliamentary committee that the regulator is looking at the issue but stopped short of suggesting that there was systemic misclassification of wholesale and retail clients.
However, he said that at the very least ASIC was concerned about potential misclassifications in circumstances where the ‘wholesale investor’ definition was a broad one.
“There are many different facets to it,” Shipton said. “There may be misclassification in a general sense, which may be different from a legal sense, because technically it may fall within the definition of a 'wholesale client'.”
“What we're looking out for, I sense is probably best expressed as an overly technical application of a person as a wholesale client that may not be in the greater scheme of things in their best interest. This is something we're actively monitoring,” the ASIC chair said.
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