MAS IMPOSES A COMPOSITION AMOUNT OF $56,250 ON INTER-ALLIANCE INTERNATIONAL (SINGAPORE) PTE LTD FOR LICENSING BREACHES UNDER THE FINANCIAL ADVISERS ACT AND FINANCIAL BREACHES UNDER THE INSURANCE (INTERMEDIARIES) REGULATIONS, AND WARNS CHIEF EXECUTIVE OFFICER
1 Inter-Alliance International (Singapore) Pte Ltd ("IAIS"), a licensed financial adviser until 18 February 2008, has paid a composition amount of $50,000 for contravention of section 13(1) of the Financial Advisers Act ("FAA"). IAIS has also paid a composition amount of $6,250 for contraventions under the Insurance (Intermediaries) Regulations ("IIR").
2 IAIS allowed 8 of its representatives to conduct financial advisory services in Singapore without holding a valid financial adviser's representative's licence under the FAA, in breach of a condition of its financial adviser's licence and hence, section 13(1) of the FAA. MAS is separately reviewing possible action against the unlicensed representatives.
3 IAIS also carried on business as an exempt insurance broker under the Insurance Act by distributing accident and health insurance products. In breach of regulation 11 of the IIR, IAIS failed to notify MAS that it was doing so. In breach of regulations 3 and 4 read with regulation 6 of the IIR, IAIS also failed to meet the minimum paid-up share capital requirement of $300,000 and professional indemnity insurance requirement of not less than $1 million for an exempt insurance broker.
4 Mr Robin Eric Deal ("Mr Deal"), IAIS' Chief Executive Officer ("CEO") from April 2005 to February 2008, was issued a supervisory warning for a contravention of section 84(1)(a) of the FAA for failing to properly discharge his duties as the CEO of IAIS, which includes managing the business of IAIS to ensure compliance with the relevant laws and regulations. Mr Deal had allowed IAIS and its representatives to sell the life products of unregistered insurers to clients in Singapore without seeking MAS' prior approval.
5 IAIS is wholly owned by the deVere and Partners group. The deVere and Partners group is in turn, owned by Mr Nigel Green.
6 The contraventions were uncovered by MAS during its inspection of IAIS in September 2007 following a series of complaints against the company.
7 IAIS ceased conducting any financial advisory services on 18 February 2008. Mr Deal resigned as the CEO on the same day.
Financial institutions should ensure that the individuals they appoint to provide financial advisory services hold the necessary licence.
MAS also expects CEOs to discharge the duties of their office properly. This includes implementing effective policies and procedures to identify and address the risks associated with the business activities of the financial adviser and ensuring compliance with the relevant laws and rules.