The Sydney Morning Herald has reported on the potential for ASIC to ban products considered "unsuitable" being distributed to retail investors.
Quoting the chairman of ASIC, Tony D'Aloisio from a speech he delivered last week, in addition ASIC's submission to the parliamentary committee investigating the financial industry, the paper reported that ASIC had concerns that the current consumer safeguards of education and improved disclosure were not necessarily providing protection for all consumers.
The change to ASIC's stance comes after concerns following a series of issues where products have been allowed to be sold to retail investors because they conformed to the risk disclosure regulations, without really considering the suitability of the product for the individual investor.
ASIC has also recently been active (and successful) in prosecuting financial advisors who had recommended clients invest in products which subsequently failed.
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