Strengthening breach reporting

The Government is today releasing exposure draft legislation for public comment which implements recommendations 1.6, 2.7, 2.8, 2.9 and 7.2 of the Royal Commission.

• Recommendations 2.8 and 7.2 will strengthen breach reporting requirements for Australian financial services licensees.
• Recommendation 2.7 will establish a compulsory scheme for checking references for prospective financial advisers. This is modelled on the existing ABA Reference Checking Protocol.
• Recommendation 2.9 will require Australian financial services licensees to investigate misconduct by financial advisers and appropriately remediate clients affected by the misconduct.
• Recommendation 1.6 will apply the new obligations under recommendations 2.7, 2.8, 2.9 and 7.2 to Australian credit licensees in relation to conduct by mortgage brokers. This will also introduce breach reporting requirements for Australian credit licensees more generally.