CORPORATIONS ACT 2001 - SECT 961J Conflict between client's interests and those of provider, licensee, authorised representative or associates

CORPORATIONS ACT 2001 - SECT 961J

  (1)   If the provider knows, or reasonably ought to know, that there is a conflict between the interests of the client and the interests of:

  (a)   the provider; or

  (b)   an associate of the provider; or

  (c)   a financial services licensee of whom the provider is a representative; or

  (d)   an associate of a financial services licensee of whom the provider is a representative; or

  (e)   an authorised representative who has authorised the provider, under subsection   916B(3), to provide a specified financial service or financial services on behalf of a financial services licensee; or

  (f)   an associate of an authorised representative who has authorised the provider, under subsection   916B(3), to provide a specified financial service or financial services on behalf of a financial services licensee;

the provider must give priority to the client's interests when giving the advice.

Note:   A responsible licensee or an authorised representative may contravene a civil penalty provision if a provider fails to comply with this section (see sections   961K and 961Q). The provider may be subject to a banning order (see section   920A).

  (2)   If:

  (a)   the provider is:

  (i)   an agent or employee of an Australian ADI; or

  (ii)   otherwise acting by arrangement with an Australian ADI under the name of the Australian ADI; and

  (b)   the subject matter of the advice sought by the client relates only to the following:

  (i)   a basic banking product;

  (ii)   a general insurance product;

  (iii)   consumer credit insurance;

  (iv)   a combination of any of those products;

subsection   (1) does not apply to the extent that the advice relates to a basic banking product or a general insurance product or a combination of those 2 products.

  (3)   Subsection   (1) does not apply to the extent that the subject matter of the advice sought by the client is a general insurance product.