The Association of Independently Owned Financial Professionals (AIOFP) has taken aim at the Financial Services Council’s (FSC) plan to reform the advice sector, terming the body’s recent white paper as “technically incorrect”, “offensive” and “politically motivated”.
In an open letter addressed to the FSC’s directors and management, the AIOFP’s executive director, Peter Johnston, made his “candid views” very clear, firing shots at the FSC’s assessment of itself as the industry’s “peak body”.
The four-page letter begins with Mr Johnston arguing against the FSC’s “financial advice fraternity” standing.
“The FSC origins via the previous entity Investment & Financial Services Association [IFSA] was principally a lobby group funded by the banks to achieve favourable political outcomes for the Liberal Party,” Mr Johnston wrote.
“We are of the view that hybrid membership associations are no longer wanted in what should be today’s consumer-centric marketplace. Transparency of objectives and best interest intentions for members and consumers should be the way to operate in our view.”
The letter then moves on to relay Mr Johnston’s thoughts on the subject matter — the white paper — and sees him employ words such as “condescending” and “patronising”.
Taking aim at the FSC’s evaluation that recent events have moulded the financial advice industry into a profession, Mr Johnston argued that he did “not consider financially starving and intimidating 9,000 advisers out of the industry over the past three years with draconian measures to be conducive to becoming a ‘profession’”.
“It has been a brutal, deliberate and targeted attack on small business by ‘faceless’ individuals in Treasury and backed up by their political allies,” he continued.
In closing, Mr Johnston accused the FSC of operating in tandem with the federal government to “placate” the advice community before the election.
“We have been reliably informed by some of your members that this document and its issues were NOT initially circulated [despite intimating it was…] among members for comment and it was embargoed in much the same fashion as a media release from a minister,” he said.
“We are of the view that whoever put the recommendations together has never given advice. It seems they have selected past ‘hot topics’ and offered partial and, in some cases, irrelevant solutions, further complicating the detail and increasing costs,” he concluded, reiterating the AIOFP’s lack of trust in the government.
Peter in my view you are only association that actually sees these faceless men and women for what they are shameless charlatans. The FPA and AFA should shunned by the small business advisers making them completely irrelevant and license should be stopped from pushing advisers into having no choice other than joining these fraudulent associations. AIOFP is our only opportunity to true fully be heard.
Thank you Peter for calling out the faceless men/women who lobby the government behind closed doors. Its clear they have never been an adviser nor understand the unworkable compliance regime advisers are forced to work with. The white paper is an absolute joke and should be treated as such.
That’s it, finally made my decision. After sitting on the sidelines for so many years, I’m cancelling my FPA membership (my CFP designation is next to useless anyway) and joining the AIOFP.
Did the same last year
The FSC represents the big end of town and did poorly at the Royal Commission.
The AIOFP represents the small business owner / financial adviser.
The FSC should recommend for their members (big end of town) and exclude the small business owner (not their jurisdiction).
The AIOFP should recommend on behalf of their members (small business), which they are doing a good job.
I’m a proud member of AIOFP …. At least Peter goes in fighting for members. I’d rather fight and lose than sit with FPA and AFA , who are simply feathering their own nests , riddled with conflicts of interest.
It’s very hard for a single FPA member to compete with AwareSuper with 300 + advisers or TelstraSuper or Hesta Advice. All those firms pay with a single cheque and sign up there advisers as members. Dante has told me we don’t just represent you, we have to represent AMP and Hesta too. Yet the needs of the adviser has very different needs to to whatever insto they belong too and AMP are big enough to look after themselves. They don’t get that. The FSC has called for an expansion of advice via means suited to Hesta and the FPA supports it. So I’ve left.
FSC never represented me while I was an AMP Planner! They may have buddied up to AMP execs, but certainly didn’t protect or support advisers directly! Thanks Peter for yet again saying what needs to be said!
The FSC demonstrated how the caliber of their executive with the absolutely shocking performance at the Royal Commission. The person should have been terminated. Instead I see that she has continued in the role.
What hope is there when a clown like that heads a significant body.
Indeed. No FSC member was condemned or banished as a result of the evidence presented at the RC (or subsequently). AMP is still a member as is BT, Colonial and MLC etc, etc, etc. This is despite the Council operating its own set of standards including this beauty:
Standard 1
The Code of Ethics and the Code of Conduct are designed to promote an investment and financial services industry of the highest integrity. The Codes recognise that the object of industry participants is to work to the highest standards of professionalism and generally meet and where possible exceed the public’s expectations. The Code of Conduct sets out the procedure for Financial Services Council members to comply with Financial Services Council Standards and the sanctions applied to those members in breach.
And they are producing advice policy. What a circus.
The FPA and AFA who are funded by the same members of the FSC come out and support the paper. The AIOFP who are not funded call it and the FSC out for what they are and their motivation.
Keep up the good work Peter.
Once again, the AIOFP is the only professional body willing to call a spade a spade and stand up for financial planners and consumers. The AFA and FPA should be ashamed and frankly wound up if they are not capable defending their members in their time of need
Depends, do you want a professional body that says what it thinks and annoys the powers that be, or keeps quiet and puts the work in behind the scenes and actually gets wins over the line by befriending the powers that be and bending their ear, instead of just hammering them in public and creating an adversary instead?
well that tactic has worked a treat so far hasn’t
‘Wins over the line’. Such as?
Johno, you are politically naïve. Politicians only act if there is media publicity. “Working behind the scenes” doesn’t work; this is evidenced by the atrocious state of the financial advice industry at the moment. New taxes (ASIC levy, TPB registrations, COSL etc) and loads of pointless red-tape.
“Befriending the powers that be”; never heard of anything more ridiculous.
Johno, its like I said to Phil Anderson recently – you can be as nice as you like to the pollies but that all takes time and there is an imminent election looming. Why not point to the rabble behind you, aka us advisers, and let politicians know that if they don’t deal with you quickly, they’ll have to deal with us. Inject some urgency into the changes we’re seeking, before we see even more irreparable carnage to our profession! Well done Peter for standing up and being heard! We are all behind you!
That’s the exact problem, their members include mostly Institutions that have much deeper pockets to fund the FPA to speak for institutions.
The FPA doesn’t give two hoots about Advisers.
Wake up any Adviser that pays fees to the FPA, you are paying an Association that is actively working to kill Advisers.
Why do Advisers pay the FPA ????
If you don’t pay you lose your CFP.
And its value would be…?
Yes and CFP’s are prepared to sell out Australians and there peers for the sake of three little letters. 20 years and never ever got any value. Only benefit I got was FASEA, more red tape and the flow on impact from a Royal Commission.
I effectively handed my CFP back (cancelled my membership) when “Principal” members of the FPA like Storm financial fell over after being a poster child of the association. It was also when the FPA accumulated a massive loss and hit up members for a “modest increase” of 45% in membership fees.
Fast forward 12 years and I have never had a client query my CFP status (or lack of one) so you might be surprised to know it really doesn’t matter.
I would question what you are really paying for with the FPA when you can join other associations to meet your requirements for the TPB etc.
In 30 years I once only had a customer ask if I was CFP.
Peter Johnson and the AIOFP need to ask members to donate to a fighting fund to take this to court and then use the rest of the funds to find Peter’s mate Jack Flader.
Or are they a body that just wants the status quo to continue by pandering to advisers who refuse to accept that change was and is needed to make this an industry that those outside of it think its professional. This is a great industry and one that truly helps the community but its riddled with rusty wheels.
Telling like it really is !!!!
How politically incorrect Mr Peter Johnston.
We love your work AIOFP & Peter Johnston, the only Adviser association that actually represents Real Advisers.
Yes, Peter Johnston and the AIOFP are known for their integrity. Just ask anyone who suffered in the Asterra / Trio debacle.
The performance was pretty good. For a while.
And the FPA and AFA came out supporting this paper……sounds all very comfy doesn’t it???
Well done Peter and Phil – urge all advisers (and their clients) to sign the Parliamentary Petition – ref EN 3360 URGENTLY.
Support Peter Johnston and the AIOFP as they have so much credibility with the government.
They have zero credibility… none.