ASIC's Outsourcing Guidelines Warns of Risks to Financial Firms
Australia’s financial services sector has long leaned on offshore support to boost capacity — from paraplanning and compliance to client service and administration.
For many firms, it’s a strategic advantage: faster scaling, lower costs, and access to specialist talent.
But ASIC’s latest findings have made one thing clear: outsourcing is no longer just a cost decision — it’s a compliance decision that can impact your licence, reputation, and client trust.
If your firm is already offshoring, or considering it, understanding ASIC’s outsourcing guidelines is key to future-proofing your operations.
Before you expand your offshore team, here’s what every AFSL holder needs to know to scale safely and compliantly.
Why ASIC is Focusing on Offshore Arrangements
In October 2025, ASIC highlighted significant governance gaps in how AFSL holders are managing their offshore and outsourced teams.
While outsourcing has long been a strategic tool — giving firms access to scale, specialist skills, and cost efficiencies — ASIC’s findings show it is now under regulatory scrutiny.
Many firms have been leveraging offshore support for paraplanning, administration, and compliance tasks without formally defining who is accountable for oversight, quality checks, or risk management.
Did You Know?
Over 300 AFSL representatives engaged offshore providers in the past two years — yet many lacked audit trails, structured monitoring, or documented governance frameworks.
What ASIC Outsourcing Guidelines Now Expect From Firms
ASIC’s message is clear: outsourcing does not outsource responsibility. Whether tasks are completed in Sydney or Cebu, AFSLs remain accountable for advice quality, client data protection, and compliance.
Governance Must Be Documented
Firms need written policies for managing offshore teams. This includes training, quality assurance, and breach reporting processes.
You Must Prove Oversight
Licensees must show how offshore work is reviewed, escalated, and audited. “Set and forget” outsourcing models will no longer pass scrutiny.
Outsourcing Doesn’t Mean Reduced Liability
Any compliance failure by offshore staff still falls squarely on the AFSL. ASIC expects full continuity of standards.
Data & Privacy Risk Under Review
Offshore access to client files, Xplan, and advice documents must be backed by explicit data security protocols and MFA/permissions controls.
It’s not outsourcing that’s under fire — it’s unmanaged outsourcing. Firms operating without clear controls are exposed to warnings, audits, and reputational damage.
Lessons from ASIC’s Review of Outsourcing Practices
ASIC’s review highlighted gaps not in the concept of offshoring itself, but in how it was managed.
Governance Gaps and Risks
Some firms lacked formal policies for selecting offshore providers, leaving quality and security vulnerable. Others failed to be transparent with clients about offshore work, which can erode trust.
Contracts often missed critical clauses around data security, system access, and recovery, and monitoring of performance or activity was inconsistent.
Furthermore, without a strong governance framework, operational control over key business processes can be lost.
Real-World Implications for Financial Firms
For financial advice practices, these issues are far from abstract. Poorly governed offshore arrangements can breach obligations under ASIC’s regulatory guides, particularly RG 104, expose sensitive data, and damage client confidence.
Transparency matters. Clients expect advisers to disclose offshore staff where relevant, and failure to do so can create compliance headaches and reputational risk.
Operationally, unmanaged teams can result in bottlenecks, communication gaps, and service interruptions, underlining that offshore support is not a free pass on responsibility.
Best Practices for Outsourcing Financial Services
To align with ASIC expectations, firms must treat offshore staffing as an extension of their licence—not a shortcut.
- Establish governance and SOPs
- Audit offshore work regularly
- Implement cybersecurity and access controls
- Document training, escalation, and reporting channels
By adhering to these principles, firms can harness the benefits of financial services offshoring in Australia without compromising compliance or service quality.
How Advice2Talent Aligns with ASIC Outsourcing Guidelines
At Advice2Talent, we help firms navigate these challenges through a legally sound Employer of Record (EOR) Philippines model.
Acting as the official employer of your offshore staff, we handle payroll, contracts, benefits, and compliance with local laws.
This approach directly addresses the risks ASIC identifies and shows how EOR protects AFSL compliance.
Quality Offshore Staffing
In addition to hiring finance-trained professionals who understand Australian workflows, we also ensure that your offshore team integrates seamlessly with your systems and standards.
We don’t place generic virtual assistants. We recruit finance-trained professionals experienced with:
- SOAs & compliance workflows
- Xplan and client review processes
- Dealer group standards
Moreover, each candidate is vetted for technical skill, communication quality, and cultural fit — ensuring they can represent your brand confidently.
Whether you need paraplanners, virtual assistants, or administrators, our team is selected for expertise, professionalism, and alignment with your firm’s values.
Embedded Governance and Oversight
Governance, monitoring, and data security are embedded into everything we do.
Transparent reporting, controlled access, and regular audits provide full visibility, while cybersecurity measures protect sensitive client information, meeting both Australian and Philippine regulations.
Our ISO-certified processes give firms confidence that their offshore operations follow globally recognized standards for quality and security.
Did You Know?
Over 300 AFSL representatives engaged offshore providers in the past two years — yet many lacked audit trails, structured monitoring, or documented governance frameworks.
Compliance With AFSL Obligations
Outsourcing is allowed under AFSL obligations, but responsibility cannot be outsourced.
Through our EOR model in the Philippines, we manage:
- Legal employment contracts
- Payroll, benefits & labour law compliance
- Local regulations aligned to AFSL standards
Choosing a structured, compliant model like Advice2Talent’s EOR solution ensures that firms can scale efficiently while maintaining control, transparency, and client trust.
Scale Securely with AFSL Compliant Offshore Teams
ASIC’s findings make one thing clear: outsourcing is not the problem, poor governance is.
By integrating strong oversight, clear communication, and legally compliant structures, Australian financial firms can harness the benefits of offshore support responsibly.
With Advice2Talent, you gain a trusted EOR partner in the Philippines, helping you scale confidently, stay compliant, and deliver high-quality service to clients — all without compromising control or security.