MAS takes action after finding breaches of the law

 

Three insurance brokers – Acclaim Insurance Brokers, Leadenhall Insurance Brokers and

Magnetron Insurance & Financial Services – have been told by the central bank to stop offering

advisory services by today.

 

And come Jan 22 next year, they will also lose their exemption from a financial adviser’s licence

requirement.

 

‘This means that they will no longer be permitted to provide financial advisory services in

Singapore,’ said the Monetary Authority of Singapore (MAS) yesterday.

Following an inspection of how the three firms provided financial advisory services, the central

bank found contraventions of the Financial Advisers Act.

‘Further, MAS found that they did not have adequate management oversight or control policies

and procedures for their financial advisory operations.’

 

This included the monitoring of the conduct of their representatives or introducers, as well as

complaint investigation and resolution process.

 

As the three firms are registered insurance brokers under the Insurance Act, they were exempted

from the requirement to hold a financial adviser’s license.

MAS said that it was ‘withdrawing (their) exempt status . . . on the grounds of their contraventions

of the FAA and in the public interest’.

It has instructed the three firms to ensure that all outstanding orders from clients and their monies

are forwarded to relevant parties. It added that the firms must inform their customers that they are

no longer allowed to provide such services; explain any effect on their investments or insurance

policies; as well as provide contact persons to handle queries relating to their loss of exemption.

 

But the status of life insurance policies of clients under these firms and premiums paid under

such policies will not be affected, said MAS.

 

Acclaim had faced police investigations a year ago over claims that clients’ funds were

channelled to Leadenhall without their permission. Some $57 million from 2,000 clients was

allegedly transferred, The Straits Times reported.

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