Slew of licences cancelled – October 11, 2024
Two financial services licences and 11 credit licences have been cancelled by ASIC. The licence holders were required by law to be members of the Australian Financial Complaints Authority (AFCA). That members gives consumers access to an independent dispute resolution scheme. ASIC works with AFCA to identify licence holders that do not comply with their obligation to maintain AFCA membership.
In the period July 4 – 10, ASIC cancelled the AFS licences of:
- Colleen Hennequin ABN 67 456 235 051(AFS licence 486117). Licence cancelled July 4, 2024.
- Aretean Pty Ltd ACN 159 826 114 (AFS licence number 460754). Licence cancelled July 20, 2024.
In the period June 6 – September 16, ASIC cancelled the credit licences of:
- George Frossinos (credit licence number 391981). Licence cancelled August 20, 2024.
- J F Consultancy and Investments Pty Ltd ACN 119 365 605 (credit licence number 392778). Licence cancelled August 22, 2024.
- Aspirepay Pty Ltd ACN 628 508 930 (credit licence number 511877). Licence cancelled August 22, 2024.
- The Finmark Group Pty Ltd ACN 000 710 029 (credit licence number 391404). Licence cancelled August 28, 2024.
- Fast Track Finance Group Pty Ltd ACN 085 407 512 (credit licence number 383791). Licence cancelled August 29, 2024.
- Supreme Funding Pty Ltd ACN 114 525 094 (credit licence number 389728). Licence cancelled September 2, 2024.
- Julie Kruger (credit licence number 392085). Licence cancelled September 6, 2024.
- Indra Tengara (credit licence number 512598). Licence cancelled September 9, 2024.
- Yeung Cheng (credit licence number 387485). Licence cancelled September 11, 2024.
- Danielle Hobbs (credit licence number 443478). Licence cancelled September 11, 2024.
- Elancorp Pty Ltd ACN 096 634 561 (credit licence number 386741). Licence cancelled September 16, 2024.
The Licensees were found to have:
- failed to be a member of AFCA;
- failed to lodge annual compliance certificates on time (credit licence holders);
- failed to prepare and lodge an annual profit and loss statement and balance sheet (AFS licence holders);
- failed to comply with a condition on the licence;
- failed to pay industry funding levies owed to ASIC;
- ceased to carry on a financial services business (AFS licence holders); and/or
- ceased to engage in credit activities (credit licence holders).
Financial adviser banned – October 9, 2024
John Hazell, an authorized representative of Richmond Partners PTY Ltd, has been banned from providing financial servics for two years.
His registration with the Tax Practitioners Board had been terminated effective March 8, 2023. It was found Hazell had made misleading statements in order to retain his registration, and that he continued to provide retail services to professional clients despite being unable to manage his own tax affairs. He then failed to reasonably engage with his professional body when concerns over conduct were raised.
Ferratum Australia licence cancelled – October 9, 2024
The Australian credit licence of Ferratum Australia Pty Ltd (in liquidation) has been cancelled following a payment of compensation by the Compensation Scheme of Last Resort (CSLR).
In April, the Australian Financial Complaints Authority made a determination against Ferratum which it failed to pay, which made CSLR pay out A$1,297 ($873) in September to a person for the determination, and then notified ASIC.
Court updates
Harvey Norman and Latitude misled consumers – October 18, 2024
Latitude Finance Australia and Harvey Norman Holdings Ltd have both been found to have engaged in misleading conduct in an advertising campaign that contained false information.
The advertisements were published in newspapers, and on TV and radio, between January 2020 and August 2021. They promoted a ‘60-month interest free and no deposit payment method’ – when in fact customers had to take out a credit card to make purchases.
Justice Yates said that customers had to enter “a fundamentally different financial arrangement than the one promoted” – specifically a continuing credit contract with Latitude with a linked credit card, which made them pay an “establishment fee and ongoing monthly account service fees in respect of that linked account.”
ASIC will seek relief including pecuniary penalties against Latitude and Harvey Norman.
Penalty for former Noumi CFO and Company Secretary – October 17, 2024
Campbell Nicholas, former CFO and Company Secretary of Noumi Limited, has been ordered to pay a A$100,000 ($66,836) penalty and to be disqualified from managing corporations for four years after continuous disclosure obligations.
He was found to have been “knowingly concerned” in the company’s disclosure breaches, breached his officer duties, and to have given false or misleading information to company directors and auditors.
The orders by the Federal Court follow an earlier judgment by his Honour Justice Jackman.
Nicholas admitted the contraventions, and was also ordered to contribute to ASIC’s legal costs. The proceedings against Noumi’s former managing director and CEO Rory Macleod are ongoing.
ASIC news weeks 41-42
ASIC Executive Leadership team appointments
Two new names have been appointed to the Commission’s senior executive leadership team.
Peter Soros has been appointed as Executive Director Regulation and Supervision. He joins from the Australian Transaction Reports and Analysis Centre, Australia’s financial intelligence and anti-money laundering and counter-terrorism financing regulator. He will start work in November.
Chris Savundra will take on the role of Executive Director Enforcement and Compliance from October 28. Recruitment for his current position of ASIC General Counsel and Executive Director Legal Services is underway.
Three new Commissioners were appointed in 2023, Diana Steicke as Executive Director Registry and Intelligence, Joanne Harper as Executive Director Data, Digital and Technology, and Annie Reeves as Chief People and Culture Transformation Officer. ASIC announced other changes to the Executive Leadership Team in April.
Warning over rise in identity theft to buy shares
The regulator has issued a warning for investors to be on high alert as incidents of stolen shares due to identity theft show a marked rise since August 2024. People who have been affected by data breaches are particularly affected.
Many of the victims remain unaware shares they hold have been transferred or sold until they receive letters from a share registry or from the Clearing House Electronic Subregister System (CHESS).
ASIC said: “Fraudulent activity using stolen identities is increasingly sophisticated, so it’s important to be vigilant and follow through with checks when you receive notifications that are unexpected or do not look right to you.” The announcement on ASIC’s website carried a list of measures investors should take.
Speech
On October 16, Commissioner Alan Kirkland spoke at the Insurance Council of Australia 2024 Annual Conference about how insurance can be complex, yet that the customers’ expectations are often quite simple.
“Listening and responding to those expectations is critical to rebuilding trust and confidence in the industry – and to giving your customers the consistently good experience that they deserve,” Kirkland said.
With having ‘improving consumer outcomes’ as a key strategic priority, Kirkland also explained that the Commission is focused on improving insurers’ claims handling, dispute resolution, and how vulnerable customers are treated.
Action against failing directors update
By taking action against directors who fail to properly manage their companies or assisting liquidators after a company collapse, ASIC has, between July 1 and September 30:
- prosecuted 68 individuals who failed to assist liquidators;
- disqualified three company directors; and
- continued prosecutions held by the Commonwealth Director of Public Prosecution against two directors for dishonest conduct relating to company funds.
The prosecutions and actions were taken against directors after:
- tax avoidance and not lodging tax returns;
- failing to pay employee entitlements such as wages and superannuation;
- failing to maintain books and records; and
- other conduct including illegal phoenix activity and insolvent trading.