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This audio version covers: What ASIC’s BID Review Will Actually Examine – and the File Evidence to Strengthen Before the Findings Land
ASIC’s First BID Review: The Broker Cheat Sheet
What it examines, the data behind it, and what makes a file strong – at a glance.
The 3 things ASIC is examining
Where ASIC is looking – and what it’s reading
Under the microscope: broker files · commission arrangements · complaints frameworks · aggregator supervision
Weak file vs strong file
Weak practice markers
- Generic best-interests statement, no client-specific reasoning
- Good outcome but no alternatives recorded
- Higher-commission product chosen, conflict priority left implicit
- Complaints “sorted on the phone” and never logged
- Reliance on the aggregator’s systems, unchecked
Stronger practice markers
- Dated, specific fact-find of needs and priorities
- Realistic alternatives listed, with reasons to set aside
- Client interest visibly prioritised over remuneration
- Every complaint logged in a live IDR system
- Comparisons captured at the time, not reconstructed
The runway
What ASIC’s BID Review Will Actually Examine – and the File Evidence to Strengthen Before the Findings Land
ASIC’s first dedicated Best Interest Duty monitoring exercise is underway. Here is what it examines, why it matters, and the file evidence to tighten before the 2026 findings are published.
For the first time since the Best Interest Duty came into force in 2021, ASIC is running a dedicated monitoring exercise focused squarely on how mortgage brokers are meeting it. The regulator confirmed the work at the MFAA’s “Looking Ahead 2026” event in February, where ASIC Senior Executive Leader Nathan Bourne spoke to an audience that included close to 3,000 registered mortgage and finance brokers. ASIC expects to publish the outcomes later in 2026 – most likely as a media statement or short-form report setting out examples of stronger and weaker practice.
Why the timing matters: The window between now and publication is the only period in which you can influence whether your files look like the “stronger” examples or the cautionary ones. Once the findings land, the standard is set in writing and the conversation shifts from preparation to defence.
What’s actually changing
To be clear, the law is not changing. The Best Interest Duty and the related conflict priority rule have applied to credit assistance providers since 1 January 2021, and ASIC’s guidance in Regulatory Guide 273 has not been rewritten. What is new is the intensity and specificity of ASIC’s attention.
This is the regulator’s first dedicated BID review. Rather than folding broker conduct into broader credit surveillance, ASIC has stood up a focused exercise with three named focus areas:
Critically, ASIC is not starting from a blank page. The review is informed by data the regulator already holds: reportable situations lodged by licensees, reports of misconduct, and external dispute resolution data from AFCA. It is also analysing broker files, commission arrangements, complaints-handling frameworks and aggregator supervision systems. In other words, ASIC is using existing signals to decide where to look harder – and the brokers and groups already showing up in that data are the ones most likely to be examined closely.
Why brokers should care
It would be easy to read “first BID review” as a routine compliance check-in. It is not. Three things make this exercise consequential.
It sets the benchmark. When ASIC publishes examples of stronger and weaker practice, those examples become the reference point aggregators, licensees, PI insurers and AFCA all reach for. A practice ASIC describes as weak does not just risk that one broker – it reshapes what “reasonable” looks like across the channel.
The file is the evidence. BID is an outcomes-and-process duty: it is not enough to have acted in the client’s interest, you have to be able to show it. If your reasoning lived in your head or in an unrecorded phone call, then as far as a reviewer is concerned, it did not happen. A thin file is not a neutral file; it is a file that fails to demonstrate compliance.
Selection is not random. Because ASIC is triangulating reportable situations, misconduct reports and AFCA data, brokers connected to elevated complaint volumes, recurring breach reports or particular product concentrations face a higher probability of scrutiny. If that describes your book or your group, treat the next few months as active preparation time.
The risks and blind spots
Most brokers who run into trouble in a review are not acting in bad faith – they have blind spots. The common ones are predictable.
- The “good outcome, thin file” trap. The loan was genuinely competitive, but the file never records the alternatives considered or why they were set aside.
- Treating BID as a tick-box. A generic best-interests statement with no client-specific reasoning is the single most common weak-practice marker. Reviewers spot boilerplate instantly.
- Conflict priority left implicit. Where a higher-commission product was recommended, the file needs to show why it was genuinely better for the client – not just that it was suitable.
- Complaints that never made it into the system. An informal grumble resolved over the phone and never logged is a complaints-handling gap.
- Assuming the aggregator has it covered. Aggregator supervision is itself under analysis. Relying on group systems without understanding what they capture is a shared risk, not a transferred one.
The opportunities
The flip side is that a focused review is also a rare chance to get ahead. A genuinely strong file is a commercial asset, not just a compliance shield – it speeds up complaint resolution, supports clean PI renewals, and makes ownership transitions and book sales far smoother because the value is documented. Being able to point to demonstrably strong practice is also a differentiator with referral partners, accountants and clients who increasingly ask how brokers manage conflicts. And if ASIC’s published examples of stronger practice happen to describe what you already do, that is external validation you can lean on for years. The cost of getting there now is low; the cost of retrofitting after a finding is high.
How this affects client conversations and lender choice
BID is not an abstract back-office obligation – it lives in the conversation and in the lender shortlist. The discovery stage is where best-interests reasoning is built. The more precisely you capture a client’s needs, objectives, priorities and trade-offs – fixed-versus-variable preference, offset needs, fee tolerance, timeline, future plans – the stronger every downstream recommendation becomes. Strong files start with strong fact-finds, dated and specific, not reconstructed later.
On lender choice, the duty does not require you to find the single cheapest loan in the market. It requires a reasonable process that genuinely serves the client. Where you place a loan, you should be able to articulate why that lender and product over the realistic alternatives – rate, structure, features, serviceability fit, turnaround, policy match. When commission could create a conflict, the conflict priority rule means the client’s interest must visibly win.
The discipline in one line: write down the comparison and the reason while you still remember it. A reconstruction is never as convincing as a contemporaneous note.
Practical steps to take now
You do not need a compliance overhaul. You need a focused tightening of the evidence on the files you are already producing, plus a check on the systems around them. Work through the checklist below before ASIC publishes.
The BID file-evidence strengthening checklist
- Fact-find depth – situation, needs, objectives and priorities recorded specifically and dated, not generic.
- Options considered – realistic alternatives listed, including products not recommended, and why.
- Recommendation reasoning – a clear, client-specific explanation of why this lender and product is in this client’s best interests.
- Conflict priority evidence – where a higher-remunerating option existed, the file shows the client’s interests were prioritised.
- Comparisons captured at the time – rate, fee, feature and serviceability comparisons saved, not reconstructed.
- Disclosures complete – remuneration, commission and referral disclosures present, current and signed where required.
- Variations documented – any change of direction or declined advice recorded with the client’s reasoning.
- Complaints logged – every complaint, including informal ones, captured in your IDR system with dates, actions and outcomes.
- IDR framework live – a written complaints process that is demonstrably followed, not just filed.
- Aggregator alignment – you understand what your aggregator’s supervision systems capture, and have addressed flagged gaps.
- Sample self-audit – pull recent files at random and read them as ASIC would.
- Remediation trail – where a past file is thin, a contemporaneous note now explains the reasoning rather than leaving a silent gap.
Start with a small random sample: pick five recent files across different lenders and client types and read each one cold. If you cannot tell from the file alone why the recommendation served the client, that is your starting point – and it is exactly the test a reviewer applies.
Conclusion
ASIC’s first dedicated BID review is not a reason to panic, but it is a reason to act with intent. The regulator has told the industry what it is looking at, which data it is using and roughly when it will report. That is a generous amount of notice. The brokers who come out of this well will not be the ones with the most sophisticated compliance department – they will be the ones whose everyday files quietly prove, on their own, that the client’s interests came first. The findings will land later in 2026. The work that decides which side of them you sit on is happening on your desk right now.
Sharper broker intelligence, every week.
Compliance, lending and growth – written for Australian brokers.
BID File-Evidence Self-Check
Score one of your recent files against what ASIC’s review is examining. Answer honestly – the gaps are the point.
This self-check is an educational prompt, not legal or compliance advice. It does not store or transmit your answers. For tailored obligations, refer to ASIC RG 273 and your licensee or aggregator’s compliance team.
Disclaimer: This article is for general information and professional development purposes only. It does not constitute legal, compliance, or financial advice. Brokers should consult their aggregator’s compliance team and, where required, seek independent legal advice regarding their obligations under the National Consumer Credit Protection Act 2009 and ASIC’s responsible lending guidelines.
