The Australian Securities and Investments Commission (ASIC) has suspended the Australian financial services licence (AFSL) of Dixon Advisory & Superannuation Services (Dixon Advisory) and is examining the transfer of its former clients to a related party.
The corporate regulator announced the suspension will take affect from 9 May to allow existing clients of the company who have not yet moved to an alternative provider to access financial services.
On 19 January, E&P Financial Group, which owns Dixon Advisory, announced the appointment of administrators to the latter, who have informed ASIC that most of its clients had transitioned to alternative financial services providers.
Apart from allowing the AFSL to continue until 9 May, the terms of the suspension also require the maintenance of dispute resolution arrangements, including Australian Financial Complaints Authority membership until 8 April 2023, and the maintenance of compensation arrangements that comply with section 912B of the Corporations Act 2001 until 8 April 2023.
In announcing the suspension, ASIC stated it “is also undertaking inquiries in relation to the transition of former clients of Dixon Advisory to Evans & Partners Pty Ltd, a related entity”.
The regulator added it was able to order the suspension because “under the Corporations Act 2001, ASIC has the power to suspend or cancel an AFS licence, without holding a hearing, where the AFS licence is held by a body corporate which is placed under external administration”.
The suspension follows the commencement of civil penalty proceedings on 4 September 2020 against Dixon Advisory for alleged conflicts, best interest failures and inappropriate advice. The proceedings are currently stayed as ASIC works with the administrators to progress them.
Dixon Advisory has the right to seek an Administrative Appeals Tribunal review of ASIC’s decision to suspend its AFSL.
