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ASIC to crack down on big four, AMP and Macquarie

ASIC to crack down on big four, AMP and Macquarie
Australia's six largest financial advice firms will be subject to surveillance from the Australian Securities and Investments Commission (ASIC) next year to make sure they comply with high-risk areas of the law.

The initiative is part of the regulator's objectives for the coming year, outlined in its Strategic Outlook for 2014/2015.

ASIC said it will conduct "proactive risk-based surveillance, concentrating on compliance in large financial institutions, and advice and dealing activities."

It will focus on the financial advice arms of AMP, Commonwealth Bank (CBA), National Australia Bank (NAB), ANZ, Westpac/BT Financial Group and Macquarie Group.

"The quality of financial advice can be affected by an adviser's conflicts of interest or lack of competence," the regulator said, and added that "this can lead to some investors and financial consumers being encouraged or advised to make financial decisions that are not in their best interests."

It will also look at responsible entities operating managed investment schemes and will "continue to identify 'red flags' and focus on high-risk entities."

ASIC also said: "we expect licensees to provide breach reports promptly so that we can identify and rectify problems with individual entities quickly and effectively where necessary."

The regulator will also "gather data on hedge funds through the global hedge fund survey to identify risks relating to gatekeeper conduct in this sector.

"We remain concerned about the culture of financial services businesses, and the incentive structures they use. A financial services business should have policies, processes and procedures in place to comply with their legal obligations," the document said.

Author: Laura Millan
Source: Financial Standard


Last modified onTuesday, 21 October 2014 23:37

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