List A barristers Charles Parkinson, Daniel Snyder, Glyn Ayres, Paul Annabell and Sahrah Hogan appeared in this case.
In this case, the Federal Court found that an Australian financial services licensee, RI Advice Group Pty Ltd (RI):
• failed to take reasonable steps under s 961L of the Corporations Act 2001 (the Act) to ensure that its authorised representatives complied with the ‘best interests obligations’ in ss 961B, 961G, 961H and 961J of the Act; and
• did not do all things necessary to ensure that the financial services covered by its licence were provided efficiently, honestly and fairly as required by s 912A of the Act.
The Court had previously made declarations that RI’s authorised representative, Mr Doyle, had contravened s 961Q of the Act by failing to comply with the best interests obligations, following admissions made during the trial.
In summary, ASIC’s case against RI was that, across five separate periods between 1 November 2013 and 30 June 2016: RI knew or ought to have known that Mr Doyle was not meeting his standards and was bypassing his compliance processes; and RI failed to take adequate steps to ensure that Mr Doyle was competent, to monitor him adequately, to escalate compliance concerns, to address concerns and to have in place adequate policies and procedures. The Court found that ASIC’s case was substantially made out during each of the five periods.
The case provides important guidance on the measures that AFSL holders must take to comply with their duties under ss 961L and 912A of the Act.
A hearing on penalties is listed on 1 February 2022.