ASIC Regulations - Breach Reporting: What You Need to Know

Conflicts of Interest Policy Development

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Conflicts of Interest Policy Development

One of the General Conduct Obligations for an Australian Credit Licence is for the Licensee to have a documented Conflict of Interest Policy to ensure their clients are not disadvantaged as a result of conflicts of interest (which may arise from engaging in credit activities).

QED Risk Services, as part of the process of assisting brokers and lenders to obtain their Credit Licence, will prepare this policy which will outline the business's processes to ensure it manages any conflicts of interest, which will comply with section 47(1)(b) of the National Consumer Credit Protection (NCCP) Act 2009. 

The Act requires all Australian Credit Licensees to have adequate measures in place to ensure clients are not disadvantaged as a result of conflicts of interest that may arise in the course of engaging in credit activities.

What is a conflict of interest?

Conflicts of interest are situations where some or all of the interests of a client (or potential client) are different to some or all of the interests of a Credit Licensee (and/or their representatives).  This includes actual as well as potential conflicts.

Examples:

1.       Finance Broker A has an interest in encouraging Client B to take a loan with XYZ Bank, even though their interest rates are much higher than ABC Bank, because XYZ pay better commissions.  This is inconsistent with Client B's interest in minimising his monthly repayments.

2.       Finance Broker C has an interest in encouraging Client D to take a $20,000 overdraft when she only requires $10,000, as this will result in higher volume commissions for C.  This is inconsistent with D's interest in minimising the amount of debt exposure she has.

This is not to say that all conflicts of interest are necessarily bad and that they must be eliminated.  Many conflicts of interest simply arise as a natural part of doing business. What is important is that our business deals with conflicts appropriately and that its customers are never disadvantaged as a result of a conflict of interest.

Credit Licensees need to demonstrate their compliance by testing the business against this policy regularly.

QED Risk Services conducts in-house compliance monitoring for brokers.  We also have a self-audit online compliance monitoring system designed for brokers to meet their NCCP compliance obligations called QED CompliFast.

What our clients say

"Greg & the team, Just a quick note to thank you for your on-going support and in particular most recently as I undertook an audit by ASIC. As a 'one man band' it is very confronting and having your support made this process far less stressful. I would have little hesitation in recommending your services to other ACL holders."
Joshua Swift
Swift Finance Solutions

"Having been referred to QED Risk Services by a client, I already had high expectations. In the end, the service provided by all the staff at QED Risk totally exceeded my already high expectations. I would not hesitate to recommend their services and moving forward, I personally will continue to use their services for my compliance requirements."
Alan Lishman
Auto Approve

"We requested help with formatting a borrowing power capacity calculator. We're a fan of QED's serviceability calculator and from this we've devised other calculators in our website. I like the fact I can pick up the phone and ring QED with any problem and it's solved straight away. Prompt service and all with a smile."
Frank Zelasko
Singh Finance, NSW

"Thanks so much for forwarding these (broker tools).Thanks again for your input and support...much appreciated."
H. W.
Broker, Tasmania

"I'm extremely pleased and grateful for the work that QED Risk Services provided for my ASIC Credit License. The stress, worry and paperwork were eliminated and we just had to wait on ASIC for the Approval, which was quicker than expected in the end. Thanks to all in the Team at QED!"
James Clark
Fish4Loans Pty Ltd

"We have recently upgraded our Credit Status from Credit Representative to an Australian Credit Licence holder.
We were initially hesitant to do so due to the fear of the Voluminous Paper Work, Compliance and General Bureaucracy of The Whole Process until QED were recommended to us. We have now been granted our ACL and the Whole Process conducted by QED and all their staff has been faultless. We were able to continue to concentrate on our business throughout the process and QED ensured a seamless transition from start to finish.

They have modelled our Compliance Procedures to reflect how we do business and QED will stay on board to ensure we are always compliant and meet our obligations day to day and in our Annual reporting.

I highly recommend QED just as they were highly recommended to me."
Kelvin Smith
Smith Finance Group

"CompliFast is great! As a one-man band with no business partners or support staff it keeps me accountable and gives me time to work on the business. CompliFast is a friendly reminder that you need to spend adequate time working on the business as much as in the business!"
Kris
Dynamic Loans SA

"A BIG thanks to QED for having the foresight to suggest that we pursue an ACL application despite not having an RM with the 'standard' background. We had spoken to other similar firms and had been told we wouldn't be able to apply. So you certainly earned the business with your broader understanding of what can be done."
Michael Saunders
Nexus Private Home Loans

"I cannot express my thanks enough for all the effort that QED placed into my ACL application & I am so thankful that I found your company when comparing so many different organisations that propose to offer a similar service.

My initial plan was to complete the ACL process on my own, however after countless hours of research it was proving to be a very difficult task, especially when trying to handle all of the other aspects involved in establishing a new company.

From day one I was comforted with the level of confidence, professionalism and expertise that your whole team demonstrated with this process.

QED literally made the process too easy and it was MUCH faster then advised, I am still shocked with how quickly the process was expedited.

I would have absolutely no hesitation in recommending QED Risk Services to anyone in the financial services industry.

I look forward to working with QED for ongoing compliance support & training."
Nick Ivers
Cyber Finance Pty Ltd

"You know what I like about your company? 1 - The fact that you communicate so clearly; 2 - that you are truly a leader - you had no reason to write this, yet you took it upon yourselves to provide thoughts and ideas without any need for a reward - which places you in a position of providing more relevance that virtually any other provider in the market - aggregators included; 3 - The thought that goes into your comments shows that it has been considered. Please keep up the good work"
Troy McErvale
Freedom Home Loans

"What some MFAA Broker Members had to say after a QED Compliance Presentation:

'Real-world advice that is factual and relevant to the job'
'Very practical advice'
'I'm a new broker so helped me to better understand my obligations'
'It was easy to follow and had good relevant content'
'Cut through the information to give us the necessary details succinctly'
'Clarification around the much misconstrued aspects of compliance and regulatory requirements'

Just some of the great feedback received when QED helped to share its knowledge with the broker community."
MFAA Broker Members

"Cannot thank Greg, Karen and the team at QED enough for their helpful service.
Certainly professionals in their field and highly recommended."
Richard Taylor
Australian Secure Capital

"Thanks for all of your hard work, effort and guidance.

Working with the QED team was very easy,"
M Ambrose
Annum

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