Underwriting agency has AFS licence suspended

ASIC has suspended the Australian Financial Services (AFS) licence of Sydney-based Group Underwriters & Managers Pty Ltd (GUM) for three months for failing to lodge financial statements, auditor reports and auditor opinions for a period of three years. This is in breach of both GUM’s legal obligations and licence conditions.

ASIC Deputy Chair Peter Kell said, ‘Licensees are required to lodge financial statements and auditor reports with ASIC to demonstrate their capacity to provide financial services. Failure to comply with reporting obligations can be an indicator of a poor compliance culture. ASIC won’t hesitate to act against licensees who do not meet these important requirements.’

The corporate regulator has suspended GUM’s licence until 16 February 2017.

If GUM does not lodge the required documents by this date, ASIC will consider whether the licence should be cancelled.

GUM provides general financial product advice only for general insurance and life insurance products and has held its Australian Financial Services licence since June 2012.

The annual lodgment of audited accounts is an important part of a licensee demonstrating it has adequate financial resources to provide the services covered by its licence and to conduct the business in compliance with the Corporations Act 2001.

ASIC will continue to contact AFS licensees who have not lodged audited financial statements and take appropriate action if they fail to lodge these statements.