ASIC puts advice firm under scrutiny

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For nine months, an independent expert will monitor the way Professional Investment Services Pty Ltd (PIS) gives financial advice, to ensure that its advice processes meet the standards set out in a major enforceable undertaking (EU).

The monitoring will test compliance of PIS’s personal advice with regulatory requirements, its ability to identify poor advice and the effectiveness of its advice audit and pre-vet functions.

The expert monitoring program follows the conclusion of an EU in March 2012, that ASIC accepted from PIS in December 2010. ASIC had concerns that compliance and audit functions required further work.

PIS has cooperated with ASIC’s inquiries. ASIC acknowledges the work done by PIS as a result of the EU and the monitoring program provides an opportunity to assess whether the implementation of the recommendations at the EU’s conclusion have been effective. The expert will report back to ASIC each quarter.

PIS is one of Australia’s largest financial planning firms, with 527 advisers.

ASIC deputy chairman Peter Kell said, “ASIC is focused on ensuring advisers do the right thing, so we will require further compliance reviews if we have concerns that advice standards are not consistently at appropriate levels.

“ASIC recognises the positive response of PIS to the concerns identified and we encourage all financial services licensees to undertake robust testing of their processes to ensure consumers get high-quality advice”.

ASIC will continue to monitor PIS’s advice process and its response to the independent expert's findings.

  • Stephen on 18/07/2013 10:53:01 AM

    I wonder how many of their clients jumped ship when the Enforceable Undertaking was offered to PIS. The 2010 EU said PIS had 430,000 client which surprised me no end. That plus the class action must have had a significant impact on the number of clients willing to stay with them. But we all know that companies can put such things in the past and move on!

  • david m on 17/07/2013 6:08:53 PM

    dealer of last resort.. why did it take so long?

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