Speaking at the ASIC Annual Forum yesterday, Mr Tanzer noted the difference between how ASIC perceived its handling of the financial planning issues at Commonwealth FP and the public’s perception.
“We thought we did a pretty good job,” Mr Tanzer said, “but clearly a lot of people didn’t think we did a good job.
“So that’s a wake-up call that we really need to think about.”
ASIC achieved $50 million worth of compensation for Commonwealth FP investors and put in place significant cultural and organisational change, Mr Tanzer said, adding that while these actions were seen as a “good job” by the regulator, there was still widespread dissatisfaction.
“There have been two things that have come out of the inquiry so far,” Mr Tanzer said.
“The first is that we are not fast enough with our enforcements. The second is that people get angry when we don’t take on their particular case.”
Mr Tanzer spoke at yesterday’s forum on a panel of ASIC commissioners that included chair Greg Medcraft.
Graeme – you’re right, but we call ourselves advisers and get paid to help people work their way around the spin. Too often advisers get fooled by the spin, when they’re supposed to be better informed. What most of us need to learn is the ability to tell the client “we don’t know. No one knows. If you want to buy it (whatever product it might be that we can’t possibly know about, but that they’ve asked about) you’ll need to do so on your own cognisance”. Of course if we actually recommend something it would be foolish to have done so without full knowledge. As advisers we need to limit advice to what we’re competent on – a bit like any other professional – and NOT rely on third party research. I do all my own and while that might limit me, I’m not afraid to confide to a client that “I don’t know.”
A great deal of investors funds has been lost by product suppliers who fool researches, advisers and investors; but only the advisers get looked at.
Some investments like Agrie products have been no better than ponzie schemes.
Sadly ASIC have become obsessed with fees, product replacement issues and disclaimers. Identifying and stamping out pockets of dangerous advice should be their no. 1 priority. That is what the public expect, and the financial planning community is crying out for a regulator that understands this.