Morgan Financial Ltd
Morgans Financial Ltd is Australia’s largest national stockbroking and wealth management companies. They provide a wide range of financial services including execution, settlement services and personal and general financial advice as well as corporate transactions such as capital raising and advisory services. As of 2019, the company has over 60,000 active clients at 60 branches nationwide, with 500 authorised representatives.
The company has drawn scrutiny from the Australian Securities and Investments Commission (ASIC) regulatory commission in recent years due to a number of breach incidents. As a result of these incidents, additional conditions were placed on the Morgans’ Australian financial services licence in 2015. In their report, ASIC questioned the company’s ability to comprehensively monitor and regulate their representatives due to the branch network and an extensive number of representatives.
In regards to the nature of the breach incidents, ASIC expressed concerns regarding the internal controls within the company. These included restrictions on staff trading, information barriers and conflicts of interest.
Key facts on Morgans case
1. ASIC has been closely monitoring Morgans’ compliance with financial services, and specifically the general obligations of financial services licenses.
2. Morgans’ extensive number of representatives and branch network in combination with a number of significant breach incidents, has raised concerns of ASIC regarding Morgans’ arrangements for monitoring and supervising its representatives.
3. In addition, ASIC has concerns about Morgans’ internal controls for the handling of confidential market-sensitive information such as restrictions on staff trading, information barriers and managing conflicts of interest in relation to corporate transactions.
Morgans’ Internal ignorance of compliance flags
According to an article in the Australian Financial Review, Morgans Financial Ltd had warnings about its problematic branches, where clients had lost thousands of dollars from the advice received. A lawsuit in Queensland supreme court by a former client against Morgans confirmed the accuracy of notes that states there are 15 compliance flags highlighted within Morgans for over 4 years about the questionable branch.
Morgans Advisors’ facing multiple lawsuits
According to articles in the Australian Financial Review and the Courier-Mail, the following is a list of advisors who have faced lawsuits including John Kirby, Michael Taylor, David Wilkins, and Joe Sim.
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