ASIC cancels/suspends AFS license of AFSL Group and Quantum Funds Management
ASIC canceled the AFS license of AFSL Group because it failed to lodge statements and audit reports and it did not maintain AFCA membership. The Australian regulator suspended Quantum because it does not have the required professional indemnity insurance coverage.
The Australian Securities and Investments Commission has canceled the AFS license of the AFSL Group Pty Ltd (AFSL Group) and suspended the AFS license of Quantum Funds Management Limited.
Both decisions were taken following failures to comply with ASIC’s regulatory requirements.
AFSL Group failed to lodge statements and audit reports + AFCA membership
AFSL Group held AFS license number 276895 since 16 August 2004. An ASIC surveillance found that AFSL Group failed to:
- lodge its financial statements and audit reports for the financial years ending 30 June 2020 and 30 June 2021, and
- maintain membership of the AFCA scheme.
Licensees are required to lodge financial statements and audit reports with ASIC to demonstrate their capacity to provide financial services. Failure to comply with reporting obligations can be an indicator of a poor compliance culture.
AFCA provides external dispute resolution services for consumers that have unresolved disputes with entities providing financial and credit services. Where licensees fail to maintain external dispute membership, ASIC will take action to cancel or suspend their licence.
The license was canceled because AFSL Group failed to comply with its obligation to lodge financial statements and audit reports for the financial years ended 30 June 2020 and 30 June 2021 and did not maintain external dispute membership.
Since ASIC’s surveillance, AFSL Group has applied for reinstatement of its AFCA membership. AFSL Group may apply to the Administrative Appeals Tribunal (AAT) for a review of ASIC’s decision.
Quantum does not have the required professional indemnity insurance coverage
ASIC has suspended the Australian financial services (AFS) license of Quantum Funds Management Limited (QFML) until 15 October 2023 because QFML does not have the required professional indemnity insurance coverage.
QFML has held AFS license no. 237301 since 30 October 2003. ASIC also recently banned Peter Geoffrey Gribble, a director of QFML, for three years.
QFML is the responsible entity of the following registered managed investment schemes:
- Quantum Mortgage Trust (ARSN 095 909 096)
- Quantum Residential Property Trust (ARSN 1695 569 335)
- Quantum USA Residential Property Fund (ARSN 150 434 138), and
- Quantum Strata Scheme No. 14 (ARSN 115 998 733).
The license suspension allows QFML to provide financial services that are reasonably necessary for, or incidental to, the winding up the schemes except the Quantum Strata Scheme No. 14 (Scheme 14), which is not being wound up. Investors in Scheme 14 should contact QFML for further information.
Under the suspension, QFML is required to have a dispute resolution system in place through membership of the Australian Financial Complaints Authority. QFML may apply to the Administrative Appeals Tribunal for a review of ASIC’s decision.
