The 2024 ASIC Corporations and Credit (Reference Checking and Information Sharing Protocol) Instrument 2024/647, effective from August 20, 2024, builds on prior regulations but introduces critical changes stemming from recent legislative reforms. These adjustments, rooted in the Treasury Laws Amendment (Modernising Business Communications and Other Measures) Act 2023, grant aggregators a more pronounced role in reference checking.
During the transitional phase, which lasts until February 28, 2025, licensees have the option to adopt either the 2021 Protocol or the newly rolled out 2024 Protocol when requesting references. This interim period allows for a smoother transition, ensuring that agencies can adjust their processes accordingly.
A standout feature of the 2024 Protocol is its discretion on obtaining additional references for mortgage broker licensees and their representatives. Unlike past protocols, the decision lies entirely with the licensees, resonating a sentiment of trust while promoting accountability.
Additionally, the updated protocol enhances transparency by incorporating a pertinent addition: a question on template consent and reference forms regarding warnings or reprimands issued to financial advisers by ASIC and the Financial Services and Credit Panel. This measure aims to uphold the integrity of the industry by providing every stakeholder with a clearer overview of an individual’s professional history.
To assist licensees in navigating these changes effectively, ASIC has revised Information Sheet 257. This updated document provides detailed guidance on complying with the reference checking requirements instituted in the 2024 Protocol.
This evolution of regulatory oversight marks a significant step towards ensuring thorough vetting processes in mortgage broking, paralleling the stringent protocols applied to financial advisers. As the industry shifts towards more robust reference checking mechanisms, stakeholders are likely to observe heightened accountability and a strengthening of standards across the board.
