Asc Tells Advisers To Obey New Law
Sydney Morning Herald
Monday July 22, 1991
MELBOURNE: The Australian Securities Commission has begun monitoring Victoria's investment advisers to enforce compliance with the new Corporations Law and ensure investors' funds are safe.
The securities industry licence surveillance program has so far investigated four investment advisory companies. On Friday the ASC froze the bank accounts of one adviser, Dollars and Sense, after alleged breaches.
It was alleged that money was transferred from a client's account without the client's permission.
The Victorian executive director of the ASC, Mr Richard Cockburn, said some investment advisory companies were breaching their licence conditions. Initially the program would concentrate on educating advisers about the law and recent changes to licence conditions.
In late 1989 investment advisory companies were obliged to disclose their commissions and train their staff.
The ASC will review the program early next month. Mr Cockburn said if widespread breaches were discovered the emphasis of the program would be shifted from education to enforcement.
"The program is designed to get the industry up to speed on the legislative requirements. It's not just a case of the Government passing legislation, we are here to ensure they read it and put it into practice," he said.
"If I have a comprehensive program I am sure to find some people who are not doing the right thing. It is only in situations where investors' money may be potentially at risk or you have got someone who is not co-operative where we will take action."
Under the program, investment advisory companies will be examined by the ASC at least once every three years. They may be examined more frequently if there are any suggestions the adviser has been breaching licence conditions or if an investor complains.
The ASC examined Dollars and Sense after a newspaper article detailed the financial difficulties of one of its owners.
Dollars and Sense will try to have the freeze on its accounts lifted in the Federal Court today.
© 1991 Sydney Morning Herald