Fund Regulatory Updates
/ASIC cancels stockbroker AFS licence
The Australian Financial Services (AFS) licence of Halifax Investment Services has been cancelled by the Australian Securities and Investment Commission (ASIC) nearly two years after it was placed in administration. The licence can operate on a limited basis until 7 January 2022 to allow clients access to the dispute resolution scheme. Halifax can compensate clients.
Halifax was found to have $19.7 million in deficiencies in client funds, totally around nine per cent of its investor funds. In August 2020, it was up to 13 per cent, or $33 million. It is alleged that client funds were used to pay for operational losses.
AustralianSuper fined for breach of privacy
Over three years ago, an AustralianSuper member filed a complaint about the industry super fund releasing their personal information to a law firm that’s services were no longer being used. The fund must now audit some procedures. The judgement was handed down by the Office of the Australian Information Commissioner (OAIC) in December 2020.
The member lodged a group insurance claim with AustralianSuper in 2014, with two law firms engaged by the claimant. By the time the claim was paid in June 2016, the claimant was no longer rising these two law firms’ services. Four claims were made in the complaint: that AustralianSuper did not inform them their claim would be handled by an administrator instead of the insurer (which the OAIC did not agree with), and that the fund disclosed their personal information to lawyers and law firms after the authority had been revoked. The OAIC found AustralianSuper had disclosed the claimant’s personal information and breached Australian privacy laws, and AustralianSuper was ordered to write an apology and pay $4,500 for the loss it caused.
Deutsche Bank fined for alleged bribery
The US Securities and Exchange Commission (SEC) has fined the bank for falsifying payment documents as they relate to third-party intermediaries. The bank has agreed to pay over US$120 million for violations of the Foreign Corrupt Practices Act (FCPA). The bank is understood by the SEC to have engaged foreign officials and their relatives and associated as third-party intermediaries, business development consultations and finders to obtain and retain global business.
The SEC order said that Deutsche Bank didn’t have sufficient internal accounting controls for payment fo the intermediaries, resulting in US$7 million in bribes, unknown and undocumented payments, or unauthorised services.
