Reference no: EM133069694

Case Study: Explain the following to Bettina and Gordon:

Bettina and Gordon are both senior traders at a major stockbroking firm, Avalanche Stockbroking.Bettina has worked in Australian equities for 10 years and Gordon has 15 years' experience in international equities. Bettina has a commerce degree, whereas Gordon demonstrated an aptitude for finance at a young age and was first employed by Avalanche in a junior position after high school. Bettina and Gordon have maintained their skills in their specific areas through internal and external seminars as well as training throughout their careers. Bettina and Gordon decided to leave Avalanche in October 2020 and set up their own boutique asset management business, Winsome Financial (Winsome), providing full service broking of Australian and international equities.Note: Winsome will not be seeking a licence to act as a stockbroker in its own name. The business will initially target superannuation funds and 'sophisticated' high net worth individuals asits clients. It will manage the funds of these clients in both discrete mandates and a pooled fund for each type of equity (Australian and international). They engage you as a consultant to their business while they transition from Avalanche. Note to students: Provide appropriate legislative references in your answer and assume no waivers have been granted in respect of the training and competency requirements.

(a) What authorisations is Winsome likely to need in its Australian financial services licence (AFSL) and why?

(b) (i) What training and competencies will Winsome need to demonstrate collectively in order to obtain an AFSL?

(ii) Is Winsome likely to have the expertise and experience required to obtain an AFSL? If you do not have sufficient information to advise them, what additional information do you need to make a decision?

(c) Assuming Winsome decides to expand their market to include retail clients before 31 December 2020, what will Winsome be required to do? (5 marks)(d) Outline three significant disclosure obligations that Winsome will have to meet as part of its disclosure regime once it provides services to a retail clientele. (6 marks)

(e) If Winsome fails to meet its disclosure obligations to its new clients, what are two possible outcomes ASIC might seek against Winsome? Refer to relevant legislative provisions in your answer. (5 marks)