Aggregators outine stance on licensing
By Jessica Darnbrough / The Adviser / 15 April, 2010
With the new licensing laws soon to be introduced, more and more aggregators are outlining their position on licensing.
Following Advantedge’s announcement last month that it will let its brokers choose whether they want to seek their own Australian Credit Licence (ACL) or become a Credit Representative (CR) of an Advantedge ACL holder, Connective has re-confirmed its decision to require all of its brokers to obtain their own ACL.
Connective principal Mark Haron told The Adviser that brokers who held their own ACL would be able to control and operate their business as they see fit.
“If a broker has their own ACL, they can effectively control their own destiny. Also, it makes it easier for them to change aggregators if they need to,” he said.
“Brokers that are credit representatives under their aggregator’s licence run the risk of being left in the cold if an aggregator looses their licence for whatever reason.”
A broker cannot operate under a lender’s licence. As such, in the event that an aggregator lost their ACL, brokers would be forced to obtain their own before they could source home loan products for their customers.
Property Planning Australia director Will Foster said Connective’s decision to force its brokers to hold their own ACL made sense to his business model.
“Even before they said which side they would take we knew we wanted to have our own licence. We want to be able to control our business and not give that luxury to someone else,” he told The Adviser.
Finance Brokers Association of Australia / FBAA
Peter J White / National President / via email 1 April 2010
Dear Members
Today starts the first day of registrations under the new NCCP and we remind you that the clock is now ticking form here to the end of June 2010 to register.
The Commonwealth Treasury has just advised the first registration was at 12.11am this morning and up to 11am there have been 256 registrations – so it has begun.
ASIC has advised that people who haven't registered with ASIC by 30 June 2010 must stop engaging in credit activities until they have a credit licence. It is important that you take the time to understand the new changes and make any necessary preparations to ensure a smooth transition to the new regime.
ASIC has developed a number of support tools to assist industry in complying with their new obligations which start today with registration:
- Regulatory Guide 202: Credit registration and transition (RG 202) Updated to take into account regulations made since the guide was released in December 2009.
- Infosheets and other regulatory guides that take people through each requirement step-by-step: www.asic.gov.au/credit
- A call centre for applicants to talk to trained staff: 1300 300 630
- A support team who are experts in using ASIC's online portals and can assist with technical enquiries: online@asic.gov.au
- A recording of ASIC's National Credit Roadshow online: www.asic.gov.au/credit
There are no fees for registration. The process is an online facility, it automatically pre-fills data where possible and is programmed not to repeat questions already asked of applicants who hold an AFS Licence. APRA-regulated applicants will also not be required to complete certain parts of the licence application.
When you apply for registration, you need to show that you can meet certain requirements that will apply to them as credit licensees. Membership of an external dispute resolution body is required; background checks will be needed so that certain statements about the past conduct of directors, company secretaries, partners or trustees involved in a business can be provided, and updates to existing entries on other ASIC registers should also be made.
Although there are very good options in the market place to act as a Credit Representative under someone else’s licence, I highly recommend you seriously consider having your own Licence and being master of your own destiny.
It is important to remember that various requirements under the NCCP are scalable, the FBAA has several strategic corporate associates whom can give you guidance now if required, as well as services for your future corporate governance management, and the necessary compliance and disclosure documents will be available to members shortly for you as will be needed post 1 July 2010 under the NCCP at a disucsonted cost for FBAA Members.
Don’t forget to register sooner than later, and have a safe and Happy Easter from the Board of the FBAA.
Peter J White
National President
NCCP Registration - "what does it mean today"
Courtesy MFAA website
You would be aware that the new National Consumer Credit Protection (NCCP) Bill comes into act on 1 July 2010.
The first stage of this legislation is the registering with ASIC of all parties involved in the credit process.
If you are not registered by 1/7/10, you can no longer be accredited with lenders or act as a broker. (New MFAA/FBAA memberships, their renewals, lender agreements aggregator agreements and PI renewal will require you to show compliance).
I suggest you don’t ignore this, and register as soon as possible as there will possibly be up to 25,000 people and entities registering. Registering does not mean you need to apply for a licence, it just gives you the ability to apply. Again, If you are not registered you cannot act as a broker.
You can register online with ASIC by clicking here (Between 1st April 2010 and 30th June 2010)
Click here for a step-by-step ASIC online registration guide
You have two choices under the new legislation:
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Get registered to obtain a Licence
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Become an authorised representative under a licence.
To read more Click Here
