26 September 2023

ASIC accounts for finance hawking

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The Australian Securities and Investment Commission (ASIC) is calling for feedback on proposed updates to its guidance on the prohibition on the hawking of financial products to the public.

ASIC Commissioner, Danielle Press said the updated regulatory guide had been changed to reflect the reforms to the anti-hawking regime under the Financial Sector Reform (Hayne Royal Commission Response) Act 2020, which are due to commence on 5 October.

Ms Press said the reforms were the result of two recommendations from the Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry.

“In its final report, the Financial Services Royal Commission stated reforming the hawking prohibition was necessary to protect consumers from being sold financial products they did not need or want,” Ms Press said.

“These reforms strengthen and consolidate the three existing hawking prohibitions into a single prohibition covering all financial products,” she said.

“The reforms take a technology neutral approach, meaning the ban applies to all forms of real-time communication.”

Ms Press said the prohibition incorporated for the first time a definition of unsolicited contact which required that consent given by a consumer be positive, voluntary and clear.

She said the reforms would give consumers greater control over the circumstances in which they were offered products and would prevent them from being approached with unwanted products on cold-calls or through other unsolicited contacts.

“They will also prevent businesses relying indefinitely on consents from consumers,” she said.

Ms Press said ASIC was seeking public comment on the draft guidance and was accepting feedback on its Consultation Paper 346 The hawking prohibition: Update to RG 38 until 17 August.

She said ASIC would publish its final guidance in September, ahead of the revised hawking prohibition commencing in October.

ASIC’s 20-page Consultation Paper, including information on how to have a say, can be accessed at this PS News link.

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