Fund Regulatory Update

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National Advice Solutions AFSL cancelled, advisers banned

The Australian Securities and Investments Commission (ASIC) has cancelled the Australian financial services (AFS) licence of National Advice Solutions and banned two responsible managers, Gail Glasby and Paul Carcallas, from providing financial services for 10 years.

The licence was cancelled because the company failed to ensure the financial services provided were provided efficiently, honestly and fairly. National Advice Solutions used a layered advice strategy that separated advice into pre-determined topics no matter the client’s individual circumstances, goals or advisory needs. The strategy blocked advisers from complying with financial services laws by providing templated and expensive advice that wasn’t tailored.

Advice separated out superannuation from insurance, even when insurance was provided via superannuation. Advice provided was found to be defective and breached financial services law.

ASIC: 21 credit licences cancelled or suspended

ASIC has cancelled or suspended 21 Australian credit licences for failure to be a member of the Australian Financial Complaints Authority (AFCA). The cancelled licences belong to:

  • Umziwam Pty Ltd

  • Paul Michael Motors Pty Ltd

  • Firstsource Advantage LLC

  • Underwood Car Finance Pty Ltd

  • Asia Pacific Finance Pty Ltd

  • Fiduciary Funds Management Pty Ltd

  • Nikki Jayne Bedggood-Forsyth

  • First Mortgage Home Loan Pty Ltd

  • Sooner Solutions Pty Ltd

  • Covesta Finance Pty Ltd

  • Thy Mai Nguyen

  • Epping PFC Pty Ltd

  • Capital-West Finance Pty Ltd

  • Deposit Shop Pty Ltd

  • Cani Management Pty Ltd

  • W. Day and H.R El-Hassan

  • Puyi Finance

  • IPLAN Financial Solutions Pty Ltd

  • Australian Mortgage Partners Pty Ltd

  • Kingston Capital Services Australia Pty Ltd

  • Thi My Hien Dang

VIG Asset Management AFSL cancelled

VIG AM has had its Australian financial services licence cancelled after receivers and managers were appointed.

MySuper heatmap shows up six products with poor performance

The MySuper heatmap has been published for the year, revealing six products with significantly poor performance per the benchmark.

  1. EISS Super's MySuper option

  2. Colonial First State FirstChoice Employer Super

  3. BT Super MySuper

  4. Westpac Group Plan MySuper

  5. Commonwealth Essential Super

  6. AMG MySuper

Some of these products also failed their performance test conducted earlier in 2022. While those products were the very worst performers, there were others that didn’t do well either, with poor performance, including:

  1. ANZ Smart Choice Super

  2. Australian Catholic Superannuation and Retirement Fund LifetimeOne

  3. AvSuper Growth

  4. Mine Superannuation Default Lifecyle

  5. Guild Retirement Fund MySuper

  6. Bendigo MySuper

  7. Russell Investments Master Trust GoalTracker

  8. Mercer Super Trust Virgin Money MySuper

  9. Mercer Super Trust Santos MySuper

Many products had notably high fees.

ASIC drops $500k SMSF threshold

Guidance on self-managed superannuation fund (SMSF) from ASIC has been updated, with the regulator removing the $500,000 minimum for the ‘appropriateness of advice’ to set up an SMSF.

A minimum threshold has not been stated, but research shows that SMSFs with balances under $200,000 tend to see considerably lower investment returns. The change allows an SMSF to grow.

Provide Capital in court over lack of documents

ASIC has commenced proceedings against Provide Nominees (trading as Provide Capital) for failure to produce documents without a reasonable excuse.

Government: Climate disclosure regime consultation

The Federal Government has commenced consultation on a mandatory climate-related financial disclosure regime, alongside a commitment to a Sustainable Finance Agenda. Companies may be required to report on climate-related financial risks and opportunities, to meet national emissions reduction targets.