ASIC has suspended the Australian financial services (AFS) licence of Melbourne-based financial services provider Australian Golden Securities Ltd (formerly, AFS Capital Securities Ltd) until 21 May 2020.
The licence has been suspended because ASIC is concerned that Australian Golden Securities is not meeting its obligations as an AFS licensee.
ASIC found that Australian Golden Securities failed to:
- lodge its accounts and audit report as a licensee for the year ending 30 June 2018;
- lodge financial reports or compliance plan auditor reports for the registered managed investment schemes it operates for the year ending 30 June 2018;
- notify ASIC of changes to its external dispute resolution scheme (EDRS);
- maintain organisational competence or the resources required to provide the financial services covered by its licence;
- comply with the financial services laws; and
- do all things necessary to ensure that the financial services covered by its licence are provided efficiently, honestly and fairly.
Upon receiving the notice of hearing from ASIC, Australian Golden Securities has taken steps to address a number of concerns including notifying ASIC of changes to its EDRS and applying for a variation to the conditions of its AFS licence. ASIC is currently considering this application.
Australian Golden Securities has not yet fulfilled its financial reporting and audit obligations. The suspension period will provide Australian Golden Securities with the opportunity to lodge its outstanding accounts, financial reports and auditor reports, and do all things necessary to address ASIC’s outstanding concerns in relation to its AFS licensee obligations.
ASIC Commissioner Danielle Press said, “It is important to get the basics right. A licensee’s failure to lodge its financial and audit reports on time indicates a lack of commitment to compliance with the law.”
ASIC will consider revoking the suspension if Australian Golden Securities is able to address ASIC’s concerns by the end of the suspension period. However, if at the end of the suspension period, Australian Golden Securities cannot demonstrate that it is able to comply with its obligations, ASIC will consider cancelling or further suspending the licence.
ASIC expects AFS licensees to do all things necessary to meet their obligations under financial services laws, comply with their licence conditions, and ensure that the financial services covered by their licence are provided efficiently, honestly and fairly.
The suspension of Australian Golden Securities’ licence is part of ASIC’s ongoing efforts to improve standards across the financial services industry.
Australian Golden Securities may apply to the Administrative Appeals Tribunal (AAT) for a review of ASIC’s decision.
Background
Australian Golden Securities has held AFS licence no. 363925 since 16 November 2010.
ASIC banned former director Dr Bingxing Hu from providing financial services for a period of five years in April 2017. Dr Hu was also a responsible manager of Australian Golden Securities until 18 April 2017 ().
On 28 June 2019, the banning order was varied by ASIC under s920D of the Corporations Act 2001 by reducing the banning period from five years to four and a half years.
On 24 July 2019, Dr Hu applied to the AAT for review of the ASIC variation decision. The application is yet to be heard.
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