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Screenshot of a breaking news alert e-mail from Q2 2017
On 31 January 2017, the Administrative Appeals Tribunal (AAT) affirmed ASIC’s decision to suspend the Australian financial services (AFS) licence held by MASU Financial Management Pty Ltd (MASU) for a period of eight weeks.
ASIC made a decision to suspend MASU’s AFS licence for 8 weeks on 26 April 2016 following concerns that MASU had not complied with its obligations and was likely to contravene its obligations.
MASU appealed ASIC’s decision to the Administrative Appeals Tribunal (AAT). On 31 January 2017, the AAT affirmed ASIC’s decision to suspend MASU’s AFS licence for 8 weeks.
AAT affirming ASIC’s decision
The AAT found that MASU was not compliant in the past and, despite recent efforts to introduce compliance measures, ‘has not yet reached the point where it can be said to be compliant.’
The AAT also concluded that ‘given that recent history, it is likely further contraventions will occur, at least until those further improvements are implemented… all financial services firms need to embrace their obligations. It is not enough that they take up the cause because they have been caught out and need to appease the regulator. They must learn to want to be compliant.’
In making its decision, the AAT stated that, ‘a brief period of suspension will help spur the embrace of a compliance culture and underline the need to avoid a return to bad behaviour…through the publication of this decision – it will deter bad behaviour by other firms. The investing public will also be encouraged by the regulatory action because it demonstrates bad behaviour will be sought out and addressed in a constructive way. That is all consistent with ASIC’s role and the objectives of Chapter 7.’
MASU has the right to appeal to the Federal Court of Australia, on a question of law, within 28 days of the AAT decision.
MASU’s AFS licence was initially suspended between 27 April 2016 and 4 May 2016 before it lodged an appeal with the AAT. Following the AAT’s decision to affirm ASIC’s decision, MASU’s licence will now be suspended from 6 February 2017 to 25 March 2017.