ASIC has proposed updates to Regulatory Guide 105 Licensing: Organisational competence (RG 105) to support the professional standards reforms, which aim to lift the education, training and ethical standards in the financial advice industry.
The proposals in Consultation Paper 305 ‘Organisational competence requirements for advice licensees: Update to RG 105’ (CP 305) are based on the existing draft guidance published by the Financial Adviser Standards and Ethics Authority (FASEA).
“Our proposals are designed to strengthen the organisational competence of financial advice licensees by ensuring that advisers are supervised by at least one responsible manager who satisfies the new education and training standards,” ASIC commissioner Danielle Press said.
“We would like to add to the existing options for responsible managers to demonstrate their knowledge and skills by introducing a new Option 6. This option will reflect the higher levels of competence expected in the industry.”
ASIC is proposing that advice licensees would be required to have at least one responsible manager who satisfies Option 6; responsible managers who wish to satisfy Option 6 would have to pass the financial adviser exam, satisfy the degree requirement that applies to existing financial advisers, and meet the CPD requirements; and both new and existing responsible managers who wish to satisfy Option 6 would have until 1 January 2021 to pass the exam and until 1 January 2024 to satisfy the degree requirement.
Submissions for CP 305 are due by 6 December 2018, with an updated RG 105 setting out the new organisational competence requirements for advice licensees expected to be released in early 2019.
RG 105 sets out the framework that ASIC uses to assess an Australian Financial Services licensee’s compliance with the organisational competence obligation in s912A of the Corporations Act 2001.
As part of this framework, AFSL applicants currently have five options for demonstrating the knowledge and skills of their responsible managers.
For responsible managers of advice licensees, the knowledge component of the relevant options is informed by the training standards for advisers in Regulatory Guide 146 Training of financial advice providers (RG 146).
The standards in RG 146, which also apply to financial advisers who provide personal advice to retail clients on more complex financial products, will be superseded by the new standards in the Corporations Amendment (Professional Standards for Financial Advisers) Act 2017. The new education and training standards will include an exam, a degree requirement, a professional year and continuing professional development (CPD) requirements.
How many financial planning senior executives in the banks are qualified as advisers or have practiced as advisers in the last 15 years? From my experience virtually none. No wonder their remediation programs are so large and unexpected. The senior executives making all the real decisions do not have a deep understanding of the intricacies of financial planning.
sadly, neither does the regulator. only ones who do are the hard working decent advisers at the coal face
people don’t know what its like for us, totally humiliating
https://www.youtube.com/watch?v=EQFaZaqUSqY
Quite correct. Here’s a sample of execs using info from their LinkedIn profiles current as of today;
– Hugh Humphrey, previous GM at CBA Financial Planning. No personal advice experience as a Rep/AR, No FP qualifications
– Jane Watts, GM BT Advice and Private Wealth. No personal advice experience as a Rep/AR, No FP qualifications
– Melinda Huggins, Head of Advice enablement ANZ. No advice experience as a Rep/AR, No FP qualifications (holds a BA in Politics)
…and so on through the Industry
[b]All these CEO’s, Executives, Managers and head honcho clowns MUST be made to do FASEA.[/b]
Agreed
So editor or adviser ratings perhaps you should do a analysis on which executives map out to the proposed requirements for RMs
Why do we not think you would be in for a shock
If we follow their track record, ASIC will be regulating to solve yesterday’s problems.
Which would be a shame, because we do have a wealth management industry that is ripe for change, supported by vibrant local tech companies.
Last thing we need is an overseas Uber-type who comes in and has the capacity to give ASIC the bird, while the rest of us chase our tails at the behest of the regulator.
Suggestion, all ASIC staff and all MP’s need to pass a closed book exam on the corporations act. Yes I understand not even solicitors or barristers are subject to closed book exams and not all ASIC staff and MP’s are lawyers, but tough luck. No ASIC or MP salaries allowed to be deducted from our taxes, all ASIC and MP’s wages must be agreed on at an annual review and if they haven’t provided a service to our liking, we don’t pay!
FASEA practice exam, Question 217, Section B Licensing and Registration.
The qualification required to be a large AFSL Manager/Owner with 200 advisers is:
A) be fat
B) turn up drunk in the afternoon after a long lunch
C) organize the wine and cheese plus fund managers to provide an economic update at a PD day
D) Manage/Negotiate your Volume bonuses and other conflicted remuneration
E) All of the above
so true. especially B!
F) Consider dodgy acquisitions to keep up the impression of ‘growth’
you are too generous, you should have added, a total and complete retard to your very excellent list
[b]FASEA for ALL involved in any part of Financial Services !!!!![/b]
ASIC, APRA, ATO, etc CEO’s, Executives & Managers making these rules must have passed them.
All Politicians must do FASEA, especially the ETHICS.
All Bank CEO’s, Executives & Managers must do FASEA.
All Life Insurance Co. CEO’s, Executives & Managers must do FASEA.
All Super Fund Trustees, CEO’s, Executives & Managers must do FASEA.
All Financial Associations, FPA, FSC, AFA, SMSFA, etc CEO’s, Executives & Managers must do FASEA.
And lets not forget the FASEA CEO’s, Executives & Managers must do FASEA, surely these people need to have passed the qualifications to be forcing them on Advisers.
“I have taken your comments on board and it’s a great idea.” said my Vice Chancellor. We’re one of only the few broke Uni’s that offer a specialised Uni Degree in Financial Planning. “cha ching. money money money””.
By way of notice, this year it’s a Bachelor of Financial Planning…. but next year the standard is a Bachelor of Applied Advisory Science.
Maybe we should all hire Tim Mackay to run our AFSL’s as he seems to know it all and has the special formula for success. His way or the highway.
His sister Claire can be the consultant to Tim. Tim and Claire know everything
Must be from the AMP business they took over from their Father when the good days of charging 5% entry fee to super and picking up commission on geared products was the flavour of the month. Oh, the reformed are hypocrites.
They remind me a lot of Terry McMaster. So utterly convinced that everything the institutions do is evil, they assume that doing the opposite must be saintly.
Putting clients into lots of direct products then charging extra fees to manage all the extra admin that creates is not necessarily in clients’ best interest. Avoiding international shares to avoid paying fund manager fees is not necessarily in clients’ best interests. Pushing clients into SMSFs when most are unsuited to the responsibilities of trustee is not necessarily in clients’ best interest.
But it does create a nice bit of work for your aligned SMSF accounting/admin business
I am surprised Tim and Claire have any spare time, considering how much time they spend on “award applications”.
I know right, this is such a funny industry. the real winners are invisible, making truck loads of money and sitting quietly watching these winners implode, every 12 to 24 months these losers get banned
whenever i see these awards and golf days i wonder how do these people have the time ? it’s because they are not very busy
please don’t incite tim, and claire mackay and terry mcmaster to write, or say anything more. i can’t take it anymore. i just can’t take any more life lessons from these people anymore
Or on social media
What pisses me off is that I can’t find an FSG on their website. Oh wait, private clients only. “Everyday” mum and dad clients not welcomed. Still get worshiped by the regulator/media/”industry” though. Even if a private client gets ripped off, they still have truck loads of money while for mum and dads the margin for error is lower and therefore they end up at the royal commission?
How many members of parliament have relevant qualifications for their given portfolio??
What, you mean Pauline Hanson doesnt have a Masters qualification?
I’d venture none, apart from the AG, given most pollies have a law background
ASIC staff need to meet the new FASEA requirements if this is the case!
Good idea in principle. But surely ASIC is jumping the gun on this as we still don’t know what the FASEA requirements will be.
Anyone in a licensee compliance role should be required to complete education as per FASEA and the exam else they aren’t competent to run a compliant licensee!
Poor old Dover had the RO being a qualified accountant, qualified solicitor and qualified financial planner. I don’t think many other RO have those qualifications. But lets cancel Dover’s AFSL anyway and leave the ISA, BIg4 and AMP to sort themselves out, we might need a job if ASIC is disbanded. Just an after thought…how many ASIC staff meet the new FASEA requirements???
Jerry come back if you can, please and thanks for taking a bullet mate. we owe you one.
But Dover had no $$$ in the bank though