ASIC has announced that it has imposed conditions on the Australian financial services (AFS) licence of Guardian Advice following surveillance which uncovered deficiencies in the advice it provided to retail clients.
ASIC was also concerned the company, which specialises in life insurance advice, was not complying with its general obligations as an AFS licensee, including failing to properly supervise its authorised representatives.
Although Guardian Advice has not provided an Enforceable Undertaking, ASIC says that under the conditions, Guardian Advice must appoint an ASIC-approved independent consultant to review its compliance with its general licensee obligations and develop a plan to rectify any deficiencies identified by the expert. The expert will report regularly to ASIC over the next two years on Guardian Advice’s implementation of the plan, and ASIC may publish the results of the reports.
ASIC’s surveillance across Guardian Advice’s business found instances where there was not a demonstrated reasonable basis for the advice provided and also files that did not evidence the advice given was in the best interests of clients.
It also found Guardian Advice did not have adequate arrangements in place to ensure it was complying with its general obligations as an AFS licensee.
Specifically, ASIC was concerned that Guardian Advice did not:
- properly assess and monitor its representatives’ competence to provide financial services
- have adequate measures in place to meet its record-keeping obligations
- adequately respond to identified breaches by its representatives, and
- have in place adequate human and technological resources.
