ASIC has announced that it is continuing to publicly name financial services licensees which are found to be unlawfully using the term “independent” about the licensee or the services they provide, following an earlier surveillance project.

Under Section 923A of the Corporations Act, a company cannot describe its advice service or itself as “independent”, “impartial” or “unbiased” if all or part of the adviser’s remuneration (or the remuneration of a related body corporate or associate) is derived from the financial products it recommends, or if there is a relationship between the adviser and a particular product issuer.

ASIC says that Wilson HTM Ltd (Wilson), iSelect Life Pty Ltd (iSelect) and Citywide Insurance Brokers and Financial Planners Pty Ltd (Citywide) have taken steps to remove or amend claims made about the independence of their services following concerns raised by ASIC about the use of the word “independent” in the entities’ marketing and promotional materials.

Wilson and iSelect both accept volume-based payments and commissions from product issuers in relation to the provision of financial services and advice. Wilson used the term “independent” to describe its business on its website and in a brochure that was distributed to consumers. iSelect used the term “independent” to describe its services in three marketing emails that were distributed to consumers.

Citywide is a corporate authorised representative of Suncorp Financial Services Pty Ltd (Suncorp). Suncorp and its authorised representatives may be remunerated through commissions. Suncorp also sets its advisers sales and retention targets in exchange for commercial benefits such as exclusive client services rights. Citywide used the term “independent” on its website to describe its’ advisers.