ASIC warns planners on death nomination practices
The Australian Securities and Investments Commission (ASIC) has put the financial advice sector on notice regarding the widespread practice of failing to correctly witness binding death nomination forms for superannuation benefits.
This followed ASIC’s discovery that many financial advisers either witness or have staff members witness client signatures on the binding forms without being in the presence of the signatory. They also found that forms had been backdated.
These practices do not comply with the Superannuation Industry (Supervision) Act 1993 and may result in the forms being invalid, which could lead to the rejection of the death nomination.
Peter Kell, acting ASIC chair said that Australian Financial Services (AFS) licensees, advisers and their staff should consider this a final warning against engaging in these practices.
He particularly emphasised that licensees would be held responsible for misconduct in this regard.
“AFS licensees have ultimate responsibility for the conduct of their representatives and need to effectively monitor and supervise their representatives,” Kell said.
ASIC said that AFS licensees must train staff on their professional and ethical obligations, monitor and supervise their representatives, remediate consumers where misconduct is found, and identify breaches in a timely manner.
AUTHOR
Hannah Wootton
Recommended for you
The Governance Institute has said ASIC’s governance arrangements are no longer “fit for purpose” in a time when financial markets are quickly innovating and cyber crime becomes a threat.
Compliance professionals working in financial services are facing burnout risk as higher workloads, coupled with the ever-changing regulation, place notable strain on staff.
The Senate economics legislation committee has recommended Schedule 1 of the Delivering Better Financial Outcomes legislation be passed as it is a “faithful implementation” of the recommendations.
Treasurer Jim Chalmers has handed down his third budget, outlining the government’s macroeconomic forecasts and changes to superannuation.
