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Screenshot of a breaking news alert e-mail from Q2 2017
The Administrative Appeals Tribunal (AAT) has affirmed ASIC’s decision to refuse an application from Clemente Group Holdings Pty Ltd seeking an Australian Financial Services (AFS) licence to provide various financial services, including to make a market in derivatives.
In her decision, the AAT’s Senior Member J F Toohey said:
In my assessment of the evidence, the applicant has not demonstrated that it has sufficient technical, human and financial resources to conduct the proposed business and mitigate the risks associated with it, and Mr Batten [the sole director, sole shareholder and its sole nominated responsible manager] does not appear seriously to have addressed those risks. There is sufficient reason to believe that the applicant is likely to contravene the obligations that will apply under s 912A if the licence is granted, in particular the obligations in s 912A (d), (e) and (h). For these reasons, I affirm the decision under review.
Welcoming the decision, Deputy Chairman Peter Kell commented:
The AAT’s decision supports ASIC’s expectation that an application for an AFS licence must be prepared to a high standard.
In particular, it should clearly explain the financial services the applicant intends to offer, and provide consistent and credible information to support and demonstrate that the applicant has the ability to deliver the requested financial services in a professional and compliant manner.
This case further emphasises the point that in deciding whether to grant a licence, ASIC will also have regard to any prior non-compliant conduct by the applicant, its directors and controllers.