The Australian Securities and Investments Commission (ASIC) has announced that it has issued an updated Regulatory Guide 181 AFS licensing: Managing conflicts of interest (RG 181).
ASIC says RG 181 has been updated to align ASIC’s guidance with developments in law and policy and draw on ASIC’s regulatory experience and insights from its surveillance of private markets, with key updates including:
- How the law applies to conflicts of interest, including the scope of the conflicts management obligation and links to other related obligations.
- The types of conflicts licensees should identify and manage.
- The need for robust, tailored arrangements to manage conflicts.
- Practical steps for effective conflict management.
- A non-exhaustive catalogue of related legal obligations and information.
First ASIC conflicted remuneration case
In Australian Securities and Investments Commission v R M Capital Pty Ltd (No 2) [2025] FCA 1634, the Federal Court ordered Australian financial services licensee RM Capital Pty Ltd to pay a $575,000 penalty and its authorised representative, The SMSF Club Pty Ltd to pay a $350,000 penalty over conflicted remuneration breaches.
RM Capital has appealed the decision
The penalties follow a Federal Court finding in February 2024 that RM Capital had failed to take reasonable steps between August 2013 and August 2016 to ensure that SMSF Club did not accept conflicted remuneration.
The referral fees were paid as part of a referral agreement between SMSF Club and Positive Real Estate. On each occasion it accepted a referral fee, SMSF Club breached the provision of the Corporations Act which prohibits an authorised representative from accepting conflicted remuneration.
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Author: David Jacobson
Principal, Bright Corporate Law
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About David Jacobson
The information contained in this article is not legal advice. It is not to be relied upon as a full statement of the law. You should seek professional advice for your specific needs and circumstances before acting or relying on any of the content.
