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ASIC revokes AFSL suspension, cancels another

ASIC has cancelled the AFSL of a financial services provider and revoked its suspension of a separate AFSL.

The regulator revoked the ASFL of NSW-based Tailormade Financial Strategies, effective 9 April 2020.

ASIC said it cancelled the AFSL because Tailormade was in liquidation.

"Under the Corporations Act 2001, ASIC may suspend or cancel an AFS licence if the licensee is under administration and is being wound up," the regulator said.

"As part of the cancellation, Tailormade is required to maintain its membership of the Australian Financial Complaints Authority for a minimum of 12 months and hold adequate professional indemnity insurance cover."

Meanwhile, ASIC has revoked its suspension of Sydney-based responsible entity Ausfunds Management's ASFL.

ASIC said it revoked the suspended Ausfunds' AFSL because it had breached its licence by failing to maintain sufficient financial resources.

"In response to the suspension order, Ausfunds raised sufficient funds to rectify its net tangible assets deficiency," ASIC said.

"In light of this, ASIC revoked the AFS licence suspension on April 21 2020."

ASIC said responsible entities with an AFSL are required to meet the minimum level of net tangible assets of $150,000.

"Ausfunds had not maintained this level of financial resources over two consecutive financial reporting periods, despite reminders from its auditor about the financial requirements of its AFS licence," the regulator said.

"Under the Corporations Act, ASIC has the power to suspend or cancel an AFS licence if a licensee does not comply with the law, or if ASIC has reason to believe a licensee is likely to contravene its legal obligations."

Ausfunds sought a review of ASIC's decision to suspend its licence by the Administrative Appeals Tribunal, and a hearing date for the appeal is yet to be set.

Read more: ASICTailormade FinancialAusfunds ManagementAustralian Financial Complaints Authority
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