ASIC panel cancels NSW adviser registration for two and a half years

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ASIC cancels NSW adviser registration

Highlights

ASIC's Financial Services and Credit Panel cancelled Byrnes' adviser registration and imposed a two-and-a-half-year prohibition on providing personal advice to retail clients.
The panel found Byrnes breached Code of Ethics Standards 1, 2, 4, 7, 8, and 12 by failing to maintain client review records, improperly charging ongoing fees, and not delivering contracted services.
Panel cited Byrnes' unresponsiveness to licensee audits and investigations, emphasizing increased regulatory scrutiny on record-keeping and substantiation of fees in Australia's financial advice sector.

Panel findings on advice and record-keeping

As reported by ASIC, the Financial Services and Credit Panel has cancelled Byrnes' registration and prohibited him from being registered as a relevant provider for two and a half years. During that period, he must not provide personal advice to retail clients in relation to relevant financial products.

The sitting panel said it reasonably believed Byrnes contravened section 921E(3) of the Corporations Act 2001 by failing to comply with the Code of Ethics' values of trustworthiness, competence, honesty and diligence, along with Standards 1, 2, 4, 7, 8 and 12.

In reaching that view, the panel found that over a number of years Byrnes failed to maintain adequate records of client annual reviews, charged ongoing financial advice fees and did not provide some clients with the services for which those fees were charged.

Compliance impact for the advice sector

The panel also found that Byrnes was unresponsive to requests from his licensee during audits and investigations into his client annual review arrangements. It considered his record-keeping failures and lack of cooperation with his licensee to be serious, protracted and inconsistent with the standards expected of a relevant provider.

The action underscores the regulatory focus in Australia's financial advice sector on documentation, delivery of ongoing services and adviser cooperation during compliance reviews. For advisers and licensees, the case highlights the operational and regulatory risks tied to poor records and failures to substantiate fees charged to clients.

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