Everything You Need To Know About AFSL Representative

Does the licensing regime prevent you from becoming an AFSL representative? If you are getting tired of continuous bills and seek the freedom of operating your own AFSL, consider becoming a representative under license. In 2005, the Financial Services Reform Act 2001 was introduced with new provisions so investors can make informed decisions about whether certain products are suitable for them.

While the Reform Act makes product disclosure statements for financial products, it also provides information relating to AFSL representatives. More specifically, established cooperate authorized representatives who are practicing under an AFSL yet are looking to operate their own AFSL, need to consider the following information:


Guidelines of Section 916D

1.       A financial services licensee must not be an authorised representative of another financial service.

2.       A purported authorisation given in breach of this requirement is void.

3.       An authorisation that starts to breach this requirement, because the person authorised is granted an AFS License, is void.

While financial advisers could acquire their own license rather than be an authorised representative, there are many unanswered questions the representative needs to be consider before attempting to transition as an AFSL. It's vital to remember the circumstances, objects, and need before deciding to exit your existing license arrangement. Here are some potential pros and cons!

Perks

§  No dealer group restrictions

§  A developed outcome for clients

§  Simplifying the compliance process

§  The potential to enhance business revenue and profit

§  Reduced risks for not having to follow dealer group directives

§  Greater control over operations, culture and direction of your business advice

§  Better flexibility and options for platforms, systems, advice templates and much more

Cons

v  Personal stress can increase due to the burden

v  You are responsible for keeping up with regulatory changes

v  There is no longer assistance and resources from a big licensee

v  Client documentation and client interaction should be maintained by you

 

End Note

Providers of Australian financial services (AFS) have enough financial resources to provide financial services and carry out operational monitoring. This may appear that AFSL representatives come with bigger responsibilities than holding an authorization under another entity's license. For those who want to learn more about this and avoid the rigmarole of other structures, connect with the team at MF & Co. Asset Management. The team will be efficient in answering your queries so that you can make the right decision. Visit the website for more details.

 

Note: This is general advice only. MF & Co Asset Management has not considered your personal financial needs, objectives, or current situation. This information is not an offer, solicitation, or recommendation for any financial product unless expressly stated. You should seek professional investment advice before making any investment decision.

Location: Sydney NSW, Australia

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