ASIC Update February 2018

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.


ASIC Shadow Shop to take place in 2018

mortgage application photo

In late 2017, ASIC announced that it intends to undertake a Shadow Shop project in 2018 to assess whether credit advice provided by mortgage brokers results in positive consumer outcomes, and to investigate what good practice looks like for brokers.

ASIC stated that the objectives of the shadow shop will be to:

  • gain insight into how consumers purchase home loans;
  • identify critical events in the purchase process;
  • understand the key inputs in decision making criteria at critical events; and
  • determine how behaviour is influenced during the purchase process.

The project is expected to include the experiences of hundreds of mortgage broker clients.


If you would like to discuss how to prepare your business or representatives for the Shadow Shop project, please get in touch with Julia on 0401 193 473 or Eloise on 0404 133 979.

ASIC spotlight stays on ‘add-on’ insurance

17 January 2018

car keys2

In two separate media releases, ASIC has again demonstrated its focus on the inappropriate sale of ‘add-on’ insurance via car dealers. These actions have highlighted ASIC’s focus on insurers acting in the best interests of customers.

Insurers, Allianz and Suncorp will have to refund approximately 100,000 customers a combined total of $65.2m in premiums after it was found that certain types of ‘add-on’ insurance were of little or no use to the consumer. These actions are consistent with ASIC’s ongoing work in this area, following recent action also being taken against Suncorp, Swann Insurance, QBE and Virginia Surety.

ASIC has repeatedly raised concerns about ‘add-on’ insurance, given the number of cases it has identified in which insurers paid car dealership staff commissions to sell policies that had little or no benefit to customers.

The types of policies in question include cover for customers who are unable to pay their car loan because of sickness, tyre and rim insurances, and Guaranteed Asset Protection insurance (GAP), which covers a customer for losses if their car is written off and their car loan exceeds the insured value of the car.

ASIC identified a number of concerns, including that GAP insurance customers were unlikely to make claims because of how the cover was designed, and that many customers were over-insured.

The work of ASIC in this area will continue throughout 2018 to ensure that improvements are made to the sale and design of insurance products. ASIC is also consulting on the introduction of a deferred sales model to introduce a pause in the sales process. For further information on this, see

Obsequium Consulting is now Compliance Co.

cropped-complianceco-black-backing1.pngblog post

An exciting start to 2018 for Obsequium Consulting, we have undergone a  re-brand!

Throughout the past year, we listened to the feedback from our valued clients and believe that the new “Compliance Co.” better reflects who we are as a compliance consulting firm.

We are, as always, confident that we can continue to provide a service that fulfils our clients’ needs, and are now able to effectively communicate this through our brand.

Our new contact details are as follows:

Julia Vojkovic (nee Feher) –

Eloise Armitage –

Directors –

Website –

Further, to our current valued clients, we wish to assure you that all current retainer agreements will continue to be fulfilled by Obsequium Consulting Pty Ltd trading as Compliance Co.

Of course, and as always, if you have any questions, comments, or just want to chat, let us know. We look forward to seeing you all in 2018.

ASIC Provides Guidance on Life Insurance Advice

12 December 2017

Business people

This week, ASIC released a new sample Statement of Advice for Life Insurance, with the purpose of providing guidance to life insurance advisers on how to produce compliant  SOAs that are concise and easy to understand.

ASIC has developed the sample SOA based on behavioural research into how consumers read and understand the information in SOAs. It contains limited advice for a new client and covers Life and TPD, Income Protection and Trauma cover.

The sample SOA is based on what ASIC has determined to be good practice disclosure, rather than best practice disclosure.

To review the sample SOA, follow the link to Regulatory Guide 90 Example Statement of Advice: Scaled advice for a new client: 



ASIC’s approach to approving licence applications.

6 December 2017


This week, ASIC released Report 553 which detailed its approach to the assessment of licence applications from July 2016 to June 2017.

The key findings included:

  • 62% of the 3,346 applications considered during the period related to AFSL and 26% to ACL applications.
  • 54% of the applications considered were approved.
  • ASIC’s current areas of focus include:
    • Crowd-sourced Funding Intermediaries – intermediaries providing public fundraising platforms must hold an AFSL;
    • Market Place Lending – allows investors to in loans to consumers and SMEs; and
    • Managed Discretionary Accounts – changes to existing policy were implemented in September 2017.
  • ASIC refused six AFS Licences during the period as ASIC had reason to believe that the applicants  would be likely to contravene their s912A obligations; and/or ASIC had reason to believe the applicant’s responsible officers were not of good fame and character.

ASIC’s 2018 Credit Focus

29 November 2017


Getting ready for 2018 and wondering where ASIC will focus its attention in the credit space?

Obsequium Consulting recently attended the ASIC Quarterly Credit Liaison meeting in Perth and identified the following key takeaways for 2018:

  • ASIC is scheduled to conduct a Shadow Shop on Mortgage Brokers and subsequently report on the findings in 2018.
  • ASIC is scheduled to review and update RG 209 Credit Licensing: Responsible Lending Conduct in 2018, with a view to better define what good practice looks likes for both lenders and brokers.
  •  The update of RG 209 will also include a focus on providing guidance on accurately and realistically recording customers’ expenses for both lenders and brokers.
  • As part of it’s new Cost Recovery Program, over the next 12 months, ASIC will release guidance to all licencees regarding how the new levies will apply.

If you would like to discuss how we can assist you in meeting your NCCP obligations, please get in touch with Julia on 0401 193 473 or Eloise on 0404 133 979.

Who can call themselves ‘Independent’?

27 November 2017


Earlier this month, ASIC released further guidance around use of terminology that implies independence.

Previously, AFS licensees and their representatives were restricted  from using the words ‘independent’, ‘impartial’ and ‘unbiased’ to describe their business, unless certain criteria were met. The further guidance released by ASIC expands the application of these restrictions to the terms, ‘independently owned’, ‘non aligned’ and ‘non institutionally owned’.

If in doubt, any terminology that implies independence cannot be used unless those certain criteria are met.

When can this terminology be used?

AFS Licensees and their representatives are able to use terminology that implies independence to describe their business if the following criteria are met:

  1. they do not receive commissions; forms of remuneration that are volume based; or other gifts or benefits from product issuers that may reasonably be expected to influence;
  2. they operate free from direct or indirect restrictions relating to the financial       products on which they provide financial services; and
  3. they are free from conflicts of interest that might arise from any relationships with product issuers and which might reasonably be expected to influence.

If you would like to discuss how these restrictions apply to your business, please get in touch with Julia on 0401 193 473 or Eloise on 0404 133 979.