The Australian Securities and Investments Commission (ASIC) has accepted an enforceable undertaking (EU) from Australian financial services licensee AIW Dealer Services Pty Ltd (AIW) to conduct an independent review of its advice processes.
ASIC's surveillance focussed on AIW’s supervision and monitoring of its representatives, in particular Otium Advice Pty Ltd (Otium).
ASIC’s surveillance found that Otium advisers had used a 'one size fits all' advice model, advised clients to switch superannuation funds when it was inappropriate to do so and failed to demonstrate the ability, professional skills and knowledge required to competently provide financial product advice.
As a result, ASIC is concerned that AIW may have failed to take reasonable steps to ensure that its representatives complied with financial services laws, and that it did not have available adequate resources to provide financial services and to carry out supervisory arrangements.
Under the EU, AIW acknowledges that these concerns are reasonable, and will engage an independent expert to assess, make recommendations and report on the effectiveness of its policies and procedures. This will also include a review of a sample of Otium client files to test AIW's file review methodology and compliance with the Corporations Act.
ASIC acknowledges the cooperation of AIW in connection with the surveillance.
Background
Otium, a financial advice business based on the Sunshine Coast in Queensland, was a corporate authorised representative of AIW from November 2012 to September 2016.
The primary financial adviser and CEO of Otium, Drew Grosskreutz, was recently banned from providing financial advice for a period of three years (17-346MR).