19 February 2018
An update on the work currently being undertaken by ASIC in the financial advice and credit spaces.
Last week it was reported that ASIC is currently conducting an “Advice Compliance Project”, the purpose of which is to ascertain whether financial advice businesses that are solely owned or controlled by a big four bank or AMP may have systemic issues relating to the monitoring of their financial advisers. ASIC is reportedly investigating approximately 60 financial advisers who demonstrated serious compliance concerns. The project has already extracted $40m of compensation from the big four banks and AMP.
Separately, a review of how banks have responded to breaches will be published mid-year and will discuss how banking groups comply with breach reporting requirements and whether the processes are in line with the organisation’s stated values.
In terms of credit supervision, a report on loan application fraud will be made public by the end of 2018, while a report on ASIC’s review of the reverse mortgage market will be published in the first quarter.
Interest only loans continue to be in the spotlight with lenders and brokers who provide large volumes of interest only loans, particularly to owner-occupier clients, expected to be made a focus.