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Rosa, an authorised representative of Tidewell Advisory, tells 15 retail clients at a seminar that a listed hybrid security is 'capital guaranteed'. It is not. Each of them invests about A$40,000; the hybrid's price has not moved, so none has lost anything. For breach reporting, Rosa's breach is BEST described as…
Answer: Deemed significant: it is misleading conduct about a financial product. A breach of a core obligation constituted by a contravention of s1041H(1) is taken to be significant (s912D(4)(c)), and calling an unguaranteed hybrid 'capital guaranteed' is that conduct.Why not the others:• not significant until a client suffers material loss…: material loss is a separate deeming ground (s912D(4)(d)), not needed here.• not significant unless Rosa made the statement knowingly…: s1041H(1) needs no intention to mislead.• not significant if Tidewell corrects it and remediates within 60 days: the 60-day rectification relief covers no more than 10 clients, and 15 clients are affected.Rule: Under s6 of ASIC Instrument 2024/620 (as amended from 27 June 2025), such a breach is not significant only if one client is affected with no loss, or no more than 10 clients are affected, total loss is A$1,000 or less and it is rectified within 60 days (notional s912D(4A), (4AA); RG 78.38). Otherwise it is reportable within 30 days (s912DAA(3)).Source: Corporations Act 2001 (Cth) ss912D, 912DAA, 1041H (compilation No. 149, 19 Sep 2026); ASIC Corporations and Credit (Breach Reporting—Reportable Situations) Instrument 2024/620 s6 (compilation No. 2, 12 Sep 2025); ASIC RG 78 Breach reporting (19 Dec 2023, updated 21 Oct 2026)
Loss is only one route to significance; misleading conduct is deemed significant even with no loss once more than 10 clients are affected.
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