Professional Investment Services enters into monitoring program

An independent expert will monitor for 9 months 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 expert monitoring program follows the conclusion in March 2012 of an EU ASIC accepted from PIS in December 2010 (refer 10-275AD). ASIC had concerns that compliance and audit functions required further work. This action demonstrates that ASIC will follow up on EU outcomes where necessary.

The expert will report back to ASIC each quarter.

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

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.

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.

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.