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ARTICLE · 03 OCTOBER 2022

Monitoring authorised representatives – Take-aways from the Lanterne case

Sophie Grace Pty Ltd
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AFSL holders should provide representatives with clear instructions about their compliance with financial services laws.

AustraliaFinance and Banking
Hannah Murray
Hannah Murray
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ASIC has recently commenced civil proceedings in the Federal Court against Lanterne Fund Services Pty Ltd (Lanterne). ASIC alleges that Lanterne failed to comply with multiple obligations of its Australian Financial Services Licence (AFSL).

Background of Lanterne

Lanterne's business model involves authorising financial services providers to operate as Corporate Authorised Representatives (CARs) or Authorised Representatives (ARs) under its AFSL. From March 2019 to October 2021, Lanterne only had one full time employee, being its sole Director and Responsible Manager. During this period Lanterne did not provide financial services directly to clients, but its representatives were responsible for over $1 billion in funds under management.

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