ASIC AFS Verification Report

ASIC has issued a report containing its findings on a program of randomly conducted verification visits on Australian financial services (AFS) licensees.

The 353 visits, which were conducted between December 2002 and July 2004, were undertaken to check that certain declarations made in a licensee’s AFS licence application were true and to ensure that the licensee’s required procedures are operational.

‘Most of the AFS licensees visited by ASIC demonstrated that appropriate procedures are in place and working well in practice. Where ASIC identified deficiencies, these issues were generally straightforward and easily addressed by the licensee’, Ms Pamela McAlister, Deputy Executive Director of Financial Services Regulation, said.

In a small number of cases ASIC will be undertaking a further compliance review.

The visits examined a number of key areas, including:

  • risk management and compliance arrangements
  • ;

  • supervision of representatives and authorised representatives
  • ;

  • adequacy of financial resources
  • ;

  • compensation arrangements
  • ; and

  • internal dispute resolution procedures
  • ;.

    ASIC intends to continue conducting random compliance visits on AFS licensees.

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