In a ruling that could have implications for other advisory firms that produce investment materials for clients, the MAS found that AAM Advisory and one of its executives, Andrew Gordon McKay, contravened “section 6(1)…[and] the then section 7(1) of the FAA [Financial Advisers Act]” in a monthly newsletter that the company saw as a service intended to help its clients to become more knowledgeable on investment matters.
The FAA sections state that no person “shall act as a financial adviser in Singapore” unless authorised to do so, nor “act as or hold himself out to be a representative of a licensed financial adviser” without the necessary licence, the regulator added, in a statement on its website.
However, Nick Anderson, one of AAM’s directors, said the "advice" in question was contained in a monthly newsletter called Global View, which had been written by Andrew McKay, an Australia-based fund manager and AAM shareholder, and never involved specific advice to any individual clients. The newsletter was discontinued towards the end of last year, when the MAS first revealed its concerns, he added.
"The information we sent out to our clients was intended to provide them our thoughts in relation to the collective investments we can advise on," Anderson explained.
"The MAS has decided, however, that the information we sent out could be construed as ‘securities’ advice, and as we do not have a securities licence, they issued us the reprimand.
"We accept the position of the MAS and no longer issue clients this monthly information."
McKay, who had been one of the founding executives of the firm, remains a shareholder but several months ago ceased to be a director, Anderson added.
According to a story which appeared in International Adviser last September, AAM Advisory is one of the largest expat-focused IFA groups in Singapore. It began as a 50% owned venture of the Singapore-based arm of accountancy firm PKF.
At the time the article appeared, AAM had 16 advisers and was looking to hire more, and assets under management in excess of $100m. Now it has 23 licensed advisers and AUM of more than $180m.
McKay had been among the PKF-AAM executives who had been with the business in 2009 when its links to PKF ended as a result of a buyout.
