ASIC cancels AFS licenses of BBY Advisory and SmarTrader


Australian regulator ASIC has announced that it has cancelled the Australian financial services (AFS) licenses held by SmarTrader Limited (SmarTrader) and BBY Advisory Services Pty Ltd (BBY Advisory), effective from 18 May 2018 and 22 May 2018 respectively.

ASIC has also decided to extend the suspension of the AFS license held by BBY Limited (BBY) until 28 May 2019.

The terms of the suspension allow the BBY AFS license to continue in effect for the following purposes only:

  • to ensure that clients of BBY continue to have access to an external dispute resolution scheme;
  • to ensure that clients of BBY continue to have access to the National Guarantee Fund;
  • to ensure that the receivers and administrators have the legal authority to transfer a client’s “holder identification number” to another market participant with instructions from the client or to convert a licensee sponsored holding to an issuer sponsored holding in accordance with the ASX Settlement Operating Rules; and
  • to ensure BBY continues to be required to have arrangements for compensating retail clients for loss or damages suffered as a result of breaches of the Corporations Act by the companies or their representatives.

Background

On 28 May 2015, ASIC suspended the AFS licenses held by BBY, BBY Advisory and SmarTrader for a period of three years.

This followed the appointment of Stephen Vaughan and Ian Hall as joint administrators to these companies on 17 May 2015. Steven Parbery and Brett Lord were appointed receivers and managers of BBY and BBY Advisory on 18 May 2015.

Under the Corporations Act, ASIC has the power to suspend or cancel an AFS licence, without holding a hearing, where the AFS license is held by a body corporate which is placed under external administration.

The companies have a right to seek a review of ASIC’s decision at the Administrative Appeals Tribunal.

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ASIC cancels AFS licenses of BBY Advisory and SmarTrader

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