Newsflash: ASIC cancels AFSL for failure to hold adequate Professional Indemnity insurance
ASIC has cancelled the AFSL held by a responsible entity of two managed investment schemes because it has not held Professional Indemnity insurance cover. ASIC’s action was taken because Epic Property Investments Ltd (Epic) has not held PI cover since 21 April 2021.
ASIC noted Epic attempted to obtain the requisite insurance cover but was unsuccessful doing so. ASIC considered that in failing to carry the cover, Epic failed to comply with its obligations under the Corporations Act 2001 (Cth) on an ongoing basis and was not providing retail clients with consumer protections required under the regulatory regime for AFS licensees. To read more about the decision please click here.
The decision is a stark reminder of ASICs intention to take action where AFSLs do not comply with their statutory duties. Bellrock can assist AFSLs with procuring appropriate professional indemnity insurance coverage to ensure compliance with the Act.