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ASIC has told the MFAA conference that it is helping brokers to help themselves through firm regulation.
Deputy chair Peter Kell told the annual conference that a strong regulatory regime not only protects consumers, it also benefits honest brokers.
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“Businesses that do the right thing by their clients, and the industry, need to be confident that the actions of unscrupulous operators don’t place them at a competitive disadvantage or undermine the broader public trust in the industry,” he said.
“ASIC recognises the role played by the MFAA in promoting professionalism within the finance industry, which is crucial to building public confidence in its members’ services.”
Mr Kell said ASIC had banned 42 people since the introduction of the National Credit Act and had no tolerance for loan fraud.
The regulator had noticed an improvement in brokers’ conduct in the years since it had taken responsibility for consumer credit, he added.
“For example, over the course of our reviews we have noted that licensees are collecting, recording and considering more information about consumers’ financial situation and their requirements and objectives,” he said.
“We have also seen licensees implementing new systems to ensure compliance of their representatives and the reliability of information provided by other third parties.”
However, Mr Kell also warned brokers that they needed to remain vigilant to ensure consumers are not disadvantaged by conflicts of interest.
“We have seen in the financial services space how investor confidence can be quickly undermined if they form the view that businesses are putting their own interests ahead of consumers’ interests,” he said.
