The Australian Securities and Investments Commission (ASIC) has opted only to suspend Rural & General Insurance Broking’s Australian financial services licence.

The move last week comes after the brokerage failed to lodge financial statements, auditors’ reports and auditors’ opinions for the 2014 and 2015 financial years.

The licence has been suspended until April 5 next year, to enable Rural & General to lodge the accounts.

This might prove tricky because founder Charles Pratten is serving a five-year jail term, with a two-year non-parole period, for defrauding the tax office of about $5 million.

He has also been banned for life from working in the financial services industry.

Pratten faces an appeal from the Commonwealth Director of Public Prosecutions against the jail sentence, and a separate appeal after being found guilty of attempting to breach a restraining order.

insuranceNEWS.com.au asked ASIC why Rural & General Insurance Broking’s licence has only been suspended when other financial services professionals committing less serious offences have had their authority cancelled outright.

The regulator and Pratten have clashed before. In 2001 ASIC issued an enforceable undertaking against Rural & General Insurance – a forerunner to the broking company.

insuranceNEWS.com.au also asked what has happened to the $5 billion of cover with more than 6000 clients the brokerage handled. This information was removed from Rural & General Insurance Broking’s website before it was shut down.

But an ASIC spokesman declined to discuss the background to the brokerage’s licence suspension.

“ASIC does not confirm or comment on whether we are investigating specific entities,” he said. “In addition, the background and reasons behind decisions made are confidential.”

Deputy Chairman Peter Kell says in a statement that failure to lodge accounts indicates “poor compliance culture”.

“ASIC won’t hesitate to act against licensees who do not meet these important requirements,” he said. “The suspension of Rural & General’s licence is part of ASIC’s ongoing efforts to improve standards across the financial services industry.”