Australian Securities & Investments Commission secures Federal Court penalties of AUD 925,000 against RM Capital and SMSF Club for conflicted remuneration

The Australian Securities & Investments Commission reported that the Federal Court has ordered Australian financial services licensee RM Capital Pty Ltd and its authorised representative The SMSF Club Pty Ltd to pay combined penalties of AUD 925,000 for breaches of the conflicted remuneration provisions in the Corporations Act. The Court also ordered both entities to obtain independent expert reports on their compliance systems and provide those reports to ASIC. RM Capital was penalised AUD 575,000 after the Court found it failed to take reasonable steps between August 2013 and August 2016 to ensure SMSF Club did not accept conflicted remuneration, contravening section 963F. SMSF Club was penalised AUD 350,000 after findings that it accepted conflicted remuneration on multiple occasions between November 2014 and July 2016, including AUD 135,863.65 in referral fees from Positive RealEstate Pty Ltd under a referral agreement linked to assisting clients to establish self-managed superannuation funds and purchase property. Within six months, RM Capital and SMSF Club must each provide ASIC with a written report from an independent expert stating whether appropriate systems, policies and procedures are in place to ensure compliance with section 963G(1) of the Corporations Act.