The Australian Securities and Investments Commission (ASIC) has confirmed it is investigating Sphere Insurance Group, the Queensland authorised representative (AR) network that entered liquidation in June 2026.
"ASIC can confirm that it has commenced an investigation and has engaged with the liquidator in connection with that investigation," an ASIC spokesperson told Insurance Business.
According to its LinkedIn page, Sphere operated from Mount Lofty in Queensland and was formed in 2015 as an AR network providing brokers with training and support services. The firm entered creditors' voluntary liquidation on June 5 2026, with Tracy Lee Knight of WCT Insolvency & Restructuring appointed liquidator, according to the notice of appointment published on ASIC's insolvency notices register.
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ASIC declined to say whether it had received a report under section 533 of the Corporations Act 2001 in relation to the company. That provision requires a liquidator to report to the regulator where it appears a past or present officer may have been guilty of an offence, or where company property may have been misapplied.
"ASIC is unable to comment on whether a report under s 533 of the Corporations Act 2001 has been received in relation to the company," the spokesperson said.
Asked what guidance exists for authorised representatives on the due diligence they should undertake on a licensee's trust account governance, ASIC pointed to the obligations that sit with the licensee rather than the representative.
"All AFS Licensees have obligations to maintain adequate compliance, supervision, governance and client money arrangements, and to take reasonable steps to ensure their representatives comply with financial services laws," the spokesperson said, directing IB to Regulatory Guide 104 on meeting the general obligations.
That division of responsibility is the structural feature of the model. In an authorised representative network, brokers write under the network's licence, so the network carries the supervision obligation while the representative carries the dependency. The licence is not the representative's to take elsewhere.
Client money obligations are also strict. Breaching them is an offence of strict liability under the Corporations Act, meaning ASIC does not need to prove intent, and the regulator expects licensees to maintain account designation and segregation, regular reconciliation of client money balances against records, documented authorisation levels for permitted withdrawals, and prompt assessment and reporting where obligations are breached, as set out in our coverage of a recent sentencing that exposed a supervision gap in an authorised representative network.
The Underwriting Agencies Council (UAC) has told members in a notice on its website that the development might have implications for insurers, underwriting agencies and other participants across the insurance distribution chain. UAC suggested those who had dealings with Sphere review any current arrangements, transactions or exposures.
ASIC would not say whether it is examining trust account handling or licensee supervision across authorised representative networks more generally.
"ASIC does not generally comment on its regulatory activities, including whether or not it is investigating a particular matter. Consistent with Information Sheet 152, we are unable to provide further comment," the spokesperson said.
The regulator has separately been consulting on arrangements that apply to authorised representatives, proposing to extend legislative instruments covering claims-handling staff notifications and Financial Services Guide obligations. Submissions closed on 8 September 2026.
Peter Marten, director and secretary of Sphere Insurance Group, has been contacted for comment. Tracy Lee Knight has also been approached.
