How to Become a Corporate Authorized Representative

If you are interested in becoming a corporate authorized representative and want to start offering financial services (directly or indirectly by acting as an introducer), you will need to obtain the necessary license before you will be legally permitted to meet your first client, offer advice or sell financial products.

It has been possible for individuals and companies to appoint a corporate authorized representative to provide financial services in Australia since the passing of the Corporations Act (2001), provided the person appointed is a current Australian Financial Services (AFS) licensee. It is also possible for a licensee to sub-authorize individuals to provide financial services on their behalf, provided the individuals concerned agree to act in accordance with the same rules and regulations that the licensee has to abide by.

This means that it is not necessary to be an AFS license holder in order to provide financial services; you can alternatively enter into a contract with a company (or individual) to act as a corporate authorized representative under its AFS license.

Organizations or companies holding a license (AFSL) are able to legally provide the full range of financial services, including providing advice on investments and financial products such as savings plans, pensions, RSA products and insurance or selling products directly to clients. They are also permitted to act as investment managers and can look after a portfolio of investments for clients and engage in dealing activities. They can invest and sell stocks, shares and commodities on behalf of their clients, alter financial products or underwrite securities and interests. Many also deal in foreign exchange contracts, securities and off-market Over-the-Counter (OTC) derivatives.

Since it is possible to sub-authorize individuals, some of these companies offer a program under which they agree to train and appoint a corporate authorized representative under the terms of their license, allowing individuals to become accredited by the Australian Securities & Investments Commission (RG146 ) and start to offer some or all of the financial services provided by the licensee.

There are a number of benefits to talking this route to becoming accredited and fulfilling ASIC obligations. If you sign a contract to act as a corporate authorized representative and provide financial services under its license, the company will usually provide a full training program to teach you about the financial products, the benefits and drawbacks of each and will provide you with the knowledge you will need to be able to deal successfully.

Many even provide dedicated one on one support during training to make becoming accredited as easy as possible. It is worthwhile looking for a company that does offer this service as it makes it far easier if you ever need some assistance, and being trained one on one means you are able to take things at your own pace. This can be especially important when learning the ins and outs of some of the more complex products such as derivatives. You may also be able to carry on with training after becoming accredited to help you provide a better service to clients or develop your own business. Many companies offer a range of optional continuing professional development training sessions to its corporate authorized representatives, making it much easier than going it alone.