The single disciplinary body for financial advisers as proposed by the Hayne royal commission commenced operations this month as planned, after legislation passed in the Federal Parliament last October.

Under the changes brought in by the Better Advice Act, the Financial Services and Credit Panel (FSCP) within the Australian Securities and Investments Commission (ASIC) now operates as the disciplinary body with its own statutory functions and powers.

The Act gives the FSCP the powers to direct financial advisers to undertake specified training, counselling or supervision and to report certain matters to ASIC.

The FSCP may also suspend or cancel a financial adviser’s registration, issue infringement notices in specified circumstances, recommend that ASIC commence civil penalty proceedings as well as enter into enforceable undertakings with financial advisers.

Additionally the legislation prescribes that ASIC must convene a FSCP if it “reasonably believes” a financial adviser is not a fit and proper person to provide advice or a financial adviser becomes an insolvent under administration and ASIC is aware of this, the corporate regulator said.

ASIC must also issue a warning/reprimand in relation to certain misconduct.

The regulator says it will proceed to issue a warning/reprimand or make a referral to an FSCP only where it has formed the “reasonable belief” after carrying out its usual triaging, investigatory work and referral processes.

“This means that not all concerns about the conduct of financial advisers that come to ASIC’s attention will result in ASIC issuing a warning/reprimand or a referral to an FSCP,” the regulator said.

ASIC says it will consult early this year on guidance regarding the operation of the FSCP and also release guidance about how it will exercise its new power to issue warnings/reprimands.