This is Information Sheet 257 (INFO 257). It is for Australian financial services (AFS) licensees and Australian credit licensees (collectively ‘licensees’) that:
This information sheet explains:
Licensees must comply with the ASIC Reference checking and information sharing protocol set out in ASIC Corporations and Credit (Reference Checking and Information Sharing Protocol) Instrument 2024/647 (ASIC protocol) as an obligation under their licence.
The ASIC protocol is made under section 912A of the Corporations Act 2001 (Corporations Act) and section 47 of the National Consumer Credit Protection Act 2009 (National Credit Act).
The ASIC protocol sets out obligations that apply to you as a licensee. It is intended to promote better information sharing about the performance history of prospective financial advisers and mortgage brokers.
The ASIC protocol contains a transitional provision allowing licensees to request a reference about a prospective representative in accordance with the ASIC protocol or the ASIC Corporations and Credit (Reference Checking and Information Sharing Protocol) Instrument 2021/429 (2021 protocol) until 28 February 2025.
From 1 March 2025, all references must be requested under the ASIC protocol.
References requested in accordance with the 2021 protocol must be in the form of a template reference request in Schedule 2 or Schedule 3 to the 2021 protocol.
References requested in accordance with the ASIC protocol must be in the form of a template reference request in Schedule 3, Schedule 4 or Schedule 5 to the ASIC protocol.
The ASIC protocol applies to:
Note: A financial adviser is a person who provides personal advice to retail clients about relevant financial products. ‘Relevant financial products’ are financial products other than basic banking products, general insurance products, consumer credit insurance, or a combination of any of these products.
A ‘prospective representative’ includes:
The ASIC protocol requires a recruiting licensee to request a reference about the prospective representative from the individual’s referee licensee(s).
The ASIC protocol also provides that a future mortgage intermediary may request a reference about a relevant mortgage broker for whom they are considering acting as an intermediary from the broker’s referee licensee(s).
The referee licensee(s) must then give a reference to share information with:
Note: Where the prospective representative is currently a licensee in their own right, the recruiting licensee must ask for a reference from the prospective representative about their conduct as a licensee.
Reference checking is one part of the screening process that licensees should undertake when deciding whether to employ or authorise a prospective representative as a financial adviser or mortgage broker.
Licensees are subject to general conduct obligations, which include taking steps to ensure that their representatives comply with financial services laws or credit legislation. ASIC expects that these steps will include undertaking appropriate background checks beyond reference checking before authorising new representatives.
Note: Regulatory Guide 104 AFS licensing: Meeting the general obligations (RG 104) and Regulatory Guide 205 Credit licensing: General conduct obligations (RG 205) contain examples of appropriate background checks (e.g. referee reports, searches of ASIC’s register of banned and disqualified persons and police checks).
As a recruiting licensee, you must take reasonable steps to obtain a reference from a referee licensee before you employ or authorise a prospective representative.
The referee licensee(s) from whom you must seek a reference are listed at Table 1. Your obligation to obtain a reference as a recruiting licensee is set out in section 5 of the ASIC protocol.
‘Reasonable steps’ include:
Note: ‘Reasonableness’ in the context of ‘reasonable steps’ has the general law meaning. If a recruiting licensee has taken the steps required by the ASIC protocol to request a reference but does not receive a reference from a referee licensee, it should determine whether the steps it has taken are reasonable. To determine whether the steps are reasonable, the recruiting licensee should take into account the facts and circumstances of the situation – for example, whether it has confirmed that its request was in fact received and/or has taken any steps to follow up its request with the referee licensee.
Obligations under the ASIC protocol also apply to recruiting licensees where a corporate representative, with a licensee’s consent, sub-authorises an individual under section 916B of the Corporations Act or section 65 of the National Credit Act to provide personal advice about relevant financial products or mortgage broking services.
Recruiting licensees must take reasonable steps to conduct reference checking in accordance with the ASIC protocol about each sub-authorised individual. You may decide what arrangements to put in place to ensure you comply with the ASIC protocol in such situations, since the protocol allows licensees to authorise agents to meet their responsibilities.
Your obligation to obtain a reference as a recruiting licensee for sub-authorised individuals is set out in section 5(3) of the ASIC protocol.
A referee licensee in relation to a prospective representative of a recruiting licensee is the prospective representative’s current licensee or former licensee in the past 5 years, as well as their current mortgage intermediary or former mortgage intermediary in the past 5 years, from whom a reference is sought.
As a recruiting licensee, you must take reasonable steps to obtain a reference for a prospective representative from the licensees described in Table 1 as the minimum requirement.
| If a prospective representative… | a reference must be sought from… |
| is currently employed or authorised by a licensee (current licensee) | the current licensee(s) |
| has been employed or authorised by the current licensee for less than 12 months | the current licensee and the most recent former licensee (if any) in the past 5 years of which the prospective representative was a representative |
| is not currently employed | the most recent former licensee in the past 5 years (and, if the prospective representative was with that licensee for less than 12 months, the next most recent former licensee (if any) of which the prospective representative was a representative) |
| is a licensee | that licensee |
In addition to the minimum prescribed licensees in Table 1 from whom you must request references, as a recruiting licensee, you may also request references from other former licensees that employed or authorised the prospective representative in the past 5 years. You may also request references from current mortgage intermediaries or former mortgage intermediaries who acted as an intermediary to the individual in the past 5 years.
For example, you may want to know about any systemic issues relating to a prospective representative, including repeated conduct or performance issues that demonstrate the individual has not responded to remedial action. This information may only come to light from references given by a prospective representative’s other former licensees or mortgage intermediaries.
Other former licensees who employed or authorised the prospective representative in the past 5 years, or current mortgage intermediaries or former mortgage intermediaries who acted as an intermediary in the past 5 years, who receive a request for a reference from you in accordance with the ASIC protocol, are obliged to give a reference about a prospective representative’s conduct for the 5 years before the reference is given.
Note: A recruiting licensee is not required to obtain a reference where a prospective representative is not currently employed or authorised by a current licensee, and the most recent former licensee(s) from whom the recruiting licensee is required to obtain a reference no longer holds a licence. In these circumstances, the recruiting licensee should consider obtaining a reference(s) in accordance with the ASIC protocol from any other former licensee(s) that the prospective representative was employed or authorised by in the past 5 years, or current mortgage intermediaries or former mortgage intermediaries who acted as an intermediary in the past 5 years.
As a future mortgage intermediary, you may request a reference about a relevant mortgage broker from a referee licensee to consider whether to act as an intermediary for that broker, with the written consent of the broker.
Referee licensees in relation to a relevant mortgage broker are the current and former licensees and/or current and former mortgage intermediaries that acted as an intermediary to the broker in the past 5 years.
Your obligation to seek consent is set out in section 6 of the ASIC protocol.
When a recruiting licensee and a future mortgage intermediary intend to request a reference in relation to an individual who is a prospective representative and relevant mortgage broker, the recruiting licensee or the future mortgage intermediary may authorise the other as their agent to obtain the reference in accordance with the ASIC protocol: see Agents acting on behalf of licensees.
This allows the recruiting licensee or the future mortgage intermediary to obtain one reference from the referee licensee in relation to the relevant individual on their own behalf and as an agent for the other party requesting a reference.
For a reference to be obtained by the recruiting licensee or the future mortgage intermediary as an agent for the other, the parties must ensure that the individual who is a prospective representative and relevant mortgage broker provides consent for the recruiting licensee and the future mortgage intermediary to obtain a reference. Consent may be obtained by one party acting as an agent for the other.
Under the ASIC protocol, personal information about a prospective representative or relevant mortgage broker can only be shared with their consent.
Before requesting a reference, you must obtain written consent from a prospective representative or relevant mortgage broker for the reference(s) to be obtained.
Your obligation as a licensee to seek the consent of the individual when requesting a reference is set out in section 6 of the ASIC protocol.
Compliance with this obligation ensures that personal information is being handled consistently with the consent of a prospective representative or relevant mortgage broker, and that the collection, use, disclosure and storage of that personal information by licensees does not breach the Australian Privacy Principles contained in the Privacy Act 1988 (Privacy Act).
Under the Australian Privacy Principles (APP) guidelines (July 2019), consent must be given for a specific purpose, and information must only be collected, used and disclosed for that purpose. Information you collect under the ASIC protocol must only be used, disclosed and stored for the purpose of:
If you are an APP entity, you will also need to comply with APP 5 by notifying the prospective representative or relevant mortgage broker about the collection of their personal information.
ASIC has provided template consent forms you must use when complying with the ASIC protocol: see Schedules 1 and 2 to the ASIC protocol.
You will not be able to request a reference from a referee licensee(s) under the ASIC protocol if a prospective representative or relevant mortgage broker does not give you written consent to request a reference.
The prospective representative or relevant mortgage broker can also withdraw their consent at any time. Unless it is withdrawn earlier, a consent will cease 12 months after it is given: see Withdrawal and ceasing of consent.
While the ASIC protocol does not prohibit you as the recruiting licensee employing or authorising a prospective representative in these circumstances, you will need to consider, and be able to demonstrate that you complied with, your general conduct obligations as a licensee if you decide to employ or authorise the prospective representative.
The ASIC protocol also does not prohibit you employing or authorising a prospective representative if you have taken reasonable steps to request a reference and a referee licensee fails to comply with their obligation to give you a reference, or if you receive a reference that contains adverse information about the prospective representative. In these circumstances, you will similarly need to consider, and be able to demonstrate that you complied with, your general conduct obligations if you decide to employ or authorise the prospective representative.
For example, you will need to ensure that the prospective representative is adequately trained, is competent and complies with relevant legislation. This means you may need to do additional background checks or assessments before employing or authorising the individual, as well as additional monitoring and supervision after they are employed or authorised.
If you are a future mortgage intermediary, it is a matter for you to decide whether to act as an intermediary for a relevant mortgage broker where:
Note: RG 104 and RG 205 provide guidance on licensee obligations relating to monitoring and supervising representatives.
A prospective representative or relevant mortgage broker who has previously given consent for references to be obtained may withdraw their consent in writing (including by email) at any time. You cannot then rely on their past consent to request a reference or update from a licensee under the ASIC protocol or for any future use or disclosure of their personal information.
Unless withdrawn earlier, a consent will cease 12 months after it is given.
Where consent is withdrawn (or has ceased) and the referee licensee(s) has not yet given you a reference or update, you must also provide written notice to the referee licensee(s) of that withdrawal (or cessation).
Note: The APP guidelines (July 2019) provide further information on withdrawing consent.
Provided you obtain written consent from a prospective representative or a relevant mortgage broker to obtain references from one or more referee licensees, you must ask the referee licensee(s) in writing to answer the questions in the correct template reference request about the prospective representative or relevant mortgage broker.
You must include a copy of the prospective representative or relevant mortgage broker’s completed consent with your reference request.
You may make minor amendments to the format of the template reference request, as long as your amended request includes all the information required by the questions in the template reference request. You must not amend or alter any of the questions.
Your obligations as a licensee when requesting a reference are set out in section 7 of the ASIC protocol.
You have some flexibility in when to make a reference request. For example, in consultation with a prospective representative or relevant mortgage broker, this may be:
Note: See Section 2 of Reference checking in the financial services industry issued by ASIC and Standards Australia in October 2007 (Standards Australia handbook) for guidance on the timing of reference requests.
You may request a clarification or update from a referee licensee about information they originally gave to you in a reference before deciding whether to employ or authorise a prospective representative, or to act as an intermediary to a relevant mortgage broker.
For example, an unresolved inquiry or investigation may be in progress for the prospective representative or relevant mortgage broker at the time the referee licensee gives you an initial reference. You may wish to defer your decision about whether to employ or authorise the prospective representative, or to act as an intermediary to the relevant mortgage broker, and seek an update from the referee licensee on the unresolved matter at a later stage.
Your request for a referee licensee to clarify or give further details about information they originally gave you in a reference, must be made in writing. However, you do not need to make the request in the form of the template reference request.
Any requests for clarifications or updates and responses to such requests form part of the records required to be kept by you under the ASIC protocol.
The template reference request asks a prescribed set of questions to give you an overview of the prospective representative or relevant mortgage broker’s conduct and performance history.
You may also want to request information about a prospective representative or relevant mortgage broker that is additional to the template reference request to help you in making a decision (e.g. background checking information as part of the wider screening process and other information from the Standards Australia handbook).
The ASIC protocol does not limit or prevent you from requesting additional information from a referee licensee(s), provided your request does not reduce the scope of the template reference request.
However, the referee licensee is not obliged under the ASIC protocol to share with you information that is additional to the prescribed questions.
The defence of qualified privilege does not apply to any information that a referee licensee shares with you outside the ASIC protocol (i.e. information that is additional to the information provided in response to the template reference requests).
We expect you to ensure that you comply with the Australian Privacy Principles in relation to any additional information you seek from a referee licensee. This includes:
Your obligations as a referee licensee are set out in section 8 of the ASIC protocol.
You must respond in writing to a licensee’s request for a reference within 10 business days, unless you both agree to a longer period (up to a maximum of 30 business days).
Note: You must not give a reference if the requesting licensee has not given you a copy of the written consent of the prospective representative or relevant mortgage broker, or if the requesting licensee has given you written notice that the prospective representative or relevant mortgage broker has withdrawn their consent.
You must give a written reference that includes all the information you are aware of and reasonably consider to be relevant to answer the template reference request.
Your response should be complete, accurate and based on documented facts that have been verified. Information given in a reference should be objective and relevant to the role and the information required by the template reference request.
You should give information that is:
If you are unable to answer any of the questions in the template reference request, you must explain in writing why you cannot answer them.
You do not need to give additional information requested by a licensee that is not covered by the template reference request.
In addition, you only need to give information about the conduct of the prospective representative or relevant mortgage broker that occurred up to 5 years before you give the reference.
Although you are not prohibited from sharing information with a requesting licensee about the conduct of a prospective representative or relevant mortgage broker that occurred more than 5 years before the reference is given, or that goes beyond the template reference request, the defence of qualified privilege does not apply to such information that is shared outside the obligations of the ASIC protocol.
To enable licensees to share information honestly and frankly, the defence of qualified privilege applies when you share information in accordance with the ASIC protocol. The defence of qualified privilege allows open communication in certain relationships without the risk of defamation action.
This defence applies if you give information about a prospective representative who is currently, or was previously, your representative, or about a relevant mortgage broker for whom you currently act or previously acted as an intermediary, because you are obliged to do so under section 8 of the ASIC protocol.
It does not apply to any information you share that you are not obliged to give (e.g. information about conduct that occurred more than 5 years ago or information that is additional to the template reference request). Also, you are not liable for any action based on breach of confidence relating to your obligation to share information under the ASIC protocol.
The template reference requests set out in Schedules 3, 4 and 5 to the ASIC protocol ask for information about a prospective representative or relevant mortgage broker in the past 5 years. Schedule 3 applies to reference requests for all prospective representatives, except where the prospective representative is a licensee in their own right – in which case Schedule 4 applies. Schedule 5 applies to reference requests for relevant mortgage brokers.
Table 2 gives an overview of the questions asked in the template reference requests and gives general guidance on interpreting and answering the questions.
To assist licensees, we have prepared:
Note: These are examples of completed template reference requests under the 2021 protocol that have been annotated to help licensees understand the requirements of the protocol. Although these examples are for the 2021 protocol, they provide general examples of the types of information a licensee might provide in response to a template reference request under either the 2021 protocol or ASIC protocol. As the referee licensee, you will need to make sure to answer the questions in the template reference request provided to you.
| Questions | Overview | General guidance |
| 1. Background information | These questions ask who completed the reference, help identify the prospective representative or relevant mortgage broker and seek details about their previous role and responsibilities. |
Note: Schedule 4 to the ASIC protocol includes similar questions about a prospective representative’s background where they are a licensee.
Question 1(a) asks you to provide the name of the organisation, the licence number, the person(s) who completed the reference and the date of completion of the reference.
Question 1(d) asks you to provide the ASIC reference number (if applicable) for the individual. An ASIC reference number includes a financial adviser number, authorised representative number or credit representative number.
Note: Schedule 4 to the ASIC protocol includes a similar question about compliance audits conducted on a prospective representative’s activities as a licensee.
In your response, indicate whether the results/outcomes were about non-compliance with financial services laws or credit legislation, and/or non-compliance with licensee processes.
‘Remedial action’ includes:
Note: A ‘compliance audit’ means an audit or review of the prospective representative or relevant mortgage broker’s compliance with financial services laws or credit legislation, and the referee licensee’s policies and procedures.
Note: Schedule 4 to the ASIC protocol includes similar questions about the conduct of a prospective representative as a licensee.
If you indicate that you reported any breaches or reportable situations at question 3(a), you will need to provide details about the date, type and nature of any reported breaches and reportable situations. This must include details of any remedial action.
Question 3(c) asks you about the individual’s involvement in:
The conduct need not amount to a contravention of the law for you to refer to it in your response to the template reference request.
Note: For the purposes of this question, ‘unprofessional conduct’ includes:
If you indicate that the individual has been involved in any of the conduct listed in question 3(c), you will need to provide a brief summary of the details. This must include relevant information about internal assessments, external notifications or complaints against the individual in connection with the provision of financial services or engaging in credit activities, and any remedial action.
Question 3(e) asks whether ASIC or the Financial Services and Credit Panel has given you a copy of a written warning or reprimand (under section 921S(2) or 921T(2) of the Corporations Act), or a copy of an instrument (under section 921M(1) of the Corporations Act) concerning the individual who is, or was, a relevant provider.
If you indicate that you have received a copy of a written warning, reprimand or instrument at question 3(e), you will need to provide a copy of the warning, reprimand or instrument and a copy of the statement of reasons for the decision.
Note: Schedule 4 to the ASIC protocol includes questions about any unresolved inquiries or investigations relating to a prospective representative’s conduct as a licensee.
If you indicate that there is an unresolved matter, you will need to provide a brief description of the nature of the circumstances that triggered the inquiry or investigation (e.g. breach, reportable situation, complaint, compliance audit, external notification, internal assessment or review, or other circumstance). You will also need to provide details of the progress and status of the inquiry or investigation.
Note: ‘Unresolved matters’ relate to inquiries or investigations resulting from a prospective representative or relevant mortgage broker’s action or inaction (rather than matters relating to a licensee’s standard review processes, such as an employee exit review).
Your other obligations as a recruiting licensee or referee licensee are set out in sections 9–13 of the ASIC protocol.
You may authorise an agent to collect, use, disclose and store personal information on your behalf in relation to a prospective representative or relevant mortgage broker for the purposes of reference checking and information sharing in accordance with the ASIC protocol.
In these circumstances, you are responsible for the acts or omissions of your agent in relation to the ASIC protocol.
Information that you collect about an individual under the ASIC protocol must only be collected, used, disclosed or stored for the purpose of considering a prospective representative’s suitability for employment or authorisation, or considering whether to act as intermediary to a relevant mortgage broker, in relation to:
Information must not be collected, used, disclosed or stored for a purpose other than that for which it was collected – unless the prospective representative or relevant mortgage broker has consented to that use or disclosure, or another exception under the Privacy Act applies.
You must not enter into any arrangements or agreements with any individual that limit your ability to collect, use, disclose and store information under the ASIC protocol.
You must have adequate arrangements in place for licensees to identify how to contact you for reference checking and information sharing purposes.
You may wish to make this information publicly available on your website. If you do not have a website, you will need to have other arrangements to ensure that licensees can readily identify how to contact you.
For example, this could be through standard arrangements when someone phones your principal public contact number or through your industry association.
You must keep accurate and complete written records for 5 years demonstrating your compliance with the ASIC protocol. The types of records you must keep include:
Keeping these records will help you comply with the ASIC protocol. ASIC will also be able to monitor whether you are undertaking reference checking in a timely, efficient and compliant manner.
The ASIC protocol does not require a licensee requesting a reference or a referee licensee to give a prospective representative or relevant mortgage broker a copy of a reference. However, a prospective representative or relevant individual may be able to obtain a copy of a reference given under the ASIC protocol under APP 12: see APP guidelines, Chapter 12 (July 2019). In certain circumstances, the handling of records relating to current and former employment relationships is exempt from the Australian Privacy Principles under the employee records exemption.
A referee licensee may voluntarily provide a prospective representative or relevant mortgage broker with a copy of a reference they have given to a licensee under the ASIC protocol.
ASIC can take enforcement action against you if you contravene your obligation to comply with the ASIC protocol (e.g. if you fail to take reasonable steps to obtain a reference as a recruiting licensee or to give a written reference to a licensee as a referee licensee).
A civil penalty applies for non-compliance with the ASIC protocol. We may also take administrative action if you do not comply with the ASIC protocol, which could include suspending or cancelling your licence or imposing additional licence conditions.
Note: See Information Sheet 151 ASIC’s approach to enforcement (INFO 151) explaining how we approach our enforcement role and Fines and penalties on the ASIC website for information about penalties, including the value of a penalty unit.
Where a prospective representative or relevant mortgage broker considers that a referee licensee has not acted in accordance with the ASIC protocol, they may:
ASIC has the power to grant exemptions and modifications from requirements of Part 7.6 (other than Divisions 4 and 8) of the Corporations Act and Chapter 2 of the National Credit Act, including the obligations in respect of the ASIC protocol: see section 926A of the Corporations Act and section 109 of the National Credit Act.
In limited circumstances, ASIC has granted relief to licensees from some requirements of the ASIC protocol to share information about current or prospective representatives of a licensee that is a wholly-owned subsidiary (within the meaning of section 9 of the Corporations Act).
For information on how to apply for relief, see Regulatory Guide 51 Applications for relief (RG 51) and Regulatory Guide 167 AFS licensing: Discretionary powers (RG 167).
Table 3 and Table 4 are checklists of questions you should ask yourself when requesting a reference or receiving a request for a reference under the ASIC protocol.
The checklists prompt you to take certain steps to help you comply with your reference checking and information sharing obligations – they do not provide a complete list of the obligations that apply to licensees under the ASIC protocol.
| Obligation | Questions to ask |
| Recruiting licensee must take reasonable steps to obtain a reference | Are you considering employing or authorising an individual as a financial adviser or mortgage broker (prospective representative) who is currently, or was formerly, a representative of an AFS licensee or credit licensee at any time in the past 5 years? If so, have you identified the licensee(s) in relation to which you must take reasonable steps to seek a reference? |
Note: This obligation does not apply to mortgage intermediaries that are considering acting as an intermediary for a relevant mortgage broker.
If the prospective representative or relevant mortgage broker withdraws their consent, or the consent ceases, before the referee licensee(s) has given a reference, have you notified the referee licensee(s) in writing of the withdrawal or cessation?
Have you given a copy of the completed consent form to the referee licensee(s) when making the reference request?
| Obligation | Questions to ask |
| Referee licensee must not give a reference without proof of written consent | Has the licensee requesting a reference given you a copy of the correct template consent form completed by the prospective representative or relevant mortgage broker consenting to the reference check? |
Has the licensee requesting a reference notified you that the consent has been withdrawn or ceased?
Do you have evidence to substantiate your answers in the template reference request?
Have you answered all the questions in the template reference request? If not, have you given a written explanation to the licensee requesting a reference about why any information is missing?
Please note that this information sheet is a summary giving you basic information about a particular topic. It does not cover the whole of the relevant law regarding that topic, and it is not a substitute for professional advice. We encourage you to seek your own professional advice to find out how the applicable laws apply to you, as it is your responsibility to determine your obligations.
You should also note that because this information sheet avoids legal language wherever possible, it might include some generalisations about the application of the law. Some provisions of the law referred to have exceptions or important qualifications. In most cases, your particular circumstances must be taken into account when determining how the law applies to you.
Information sheets provide concise guidance on a specific process or compliance issue or an overview of detailed guidance.
This information sheet was updated in August 2024.
What you need to know
