ASIC intended to cancel Dover’s licence due to compliance issues with the licensee that have not yet been made public, an ASIC spokesperson told ifa.
It is understood Dover wanted to continue trading for a longer period, however the decision to abruptly close the licence last week was made by the licensee rather than the regulator.
ASIC also released further guidance for affected advisers, their clients and licensees looking to on-board ex-Dover personnel.
“In the past, ASIC has warned AFS licensees to ensure they have robust recruitment and monitoring when appointing advisers who have worked for a licensee with a poor compliance history,” the guidance said.
It also said that “any licensee considering authorising an ex-Dover adviser” should make arrangements to address any deficiencies in the advice given by ex-Dover advisers, and “have heightened oversight (for instance, vet all advice from ex-Dover advisers for a period)”.
“When hiring a new adviser ASIC suggests that, at a minimum, licensees receive audit reports and/or reference checks from the previous licensee. In the case of ex-Dover advisers, you should get audit reports and/or a reference from the licensee before Dover and/or do other assessments of the person’s competence,” the guidance said.
This guidance followed an initial statement from the regulator acknowledging an ongoing investigation into Dover that commenced in 2017.
Who the heck is this “Steven” to whom a few of you refer? I can’t see a “Steven” in any of the comments so far. Please explain Pauline????!
BUMP . . . Anyone?
In 1980 Steven invested $4,000 in the AXA Balanced Fund and in 2013 it was worth $4,100 and he’s been bitter ever since.
Don’t blame Advisers Steven. Unfortunately Advisers have to provide people with Consumer Protection Documents (called SoA’s). Let’s get rid of compliance, red tape, SoA’s, ROA’s FDS, FSG, PDS’s etc plus get rid of licensing, (look at Dover) also get rid of the right to complain then make it compulsory for every tax paying adviser to lodge a tax return style of investment report and I’d be more than happy to charge every single client an hourly rate. Until then I have to keep turning people away.
Post your practice name and address and let’s see how wholesome you are.
It’s a rort, you know it, I know it, everyone knows it. End of story. Stop thinking of your business and stop ripping off clients.
I think everyone is being unfair on Stop the Rort. There is a lot of unjustified client cost in the fee for service model and the industry has caused its problems in this respect.
It doesn’t matter whether you charge on an hourly rate or a fix annual fee you have to be able to justify that you have actually done the work you are charging for and that there is for value to the client. The percentage of FUA model is flawed and has unfairly inflated many advisers fees. The poor client as much as they try, do find it hard to really assess what the right fee is. Just shopping around a number of advisers doesn’t give the answer because ( yes a generalisation ) what’s the point in benchmarking when everyone charges too much. It’s like shopping around for the best electricity supplier when even the cheapest is charging too much.
Accountants aren’t angels and many, probably most, are over-charging so they shouldn’t be held up as the ideal model but an hourly rate model is at least easy to “interrogate”.
You have to honestly ask yourself – if you left the industry today and needed an adviser would pay the same fee that you are charging your clients? Really put yourself in a client’s position. If you are truly honest you will answer no.
Thats why grandfathering should be abolished. That way any fee for service arrangement will need to be agreed to ongoing and everyone will need to justify this with service. There are plenty of advisers that justify their fee every year, we are just held back by those who dont and those who just bought up grandfathered revenue streams to never service.
Yes more advisers are charging for “project work” but it’s not a core business. The busiest business in my town Steven is the Charity food business. The line is out the door and around the corner. That’s what’s going to happen when people are charged hourly rates like Accountants. Have you ever worked in an accounting firm? I’m busy as I am writing this message from the Foothills of Mount Everest but I’ve found some time to reply. The Sherpa gave me the map and pointed to the sky and grunted “that direction”. I paid him his hourly rate and he said “good luck”. I’ll think about your comments as I’m climbing that journey by myself. I just hope that based on your advice philosophy that at 40,000 feet when my line breaks I’ll be able to call and consult that Sherpa for an hourly rate again.
Maybe when events like 9/11 happens working on hourly rates, I could triple my rates because demand goes up or just turn them away. Or like Accountants when its BAS lodgement season the Mum and Dad seeking advice gets a crappy 5 minutes and a half arsed job and like the Sherpa say that direction and point to the door.
You mean like accountants who ‘charge’ billables, then write part of it off, because they realise the client won’t pay the quoted ‘billables’ as the end fee is unpredictable and just too high. You mean those kinds of billables? Riiiiiggghhhttt…………..
Put a sock in it “Steven”
Who’s Steven?
Stop the Rort. Wrong. An hour long meeting involves quite a few hours lead up time. SOA. Research etc etc. plus presentation. If a planner delivers the agreed service at the agreed fee, there is no issue. F D S also serves as a backup for the client. Any questions Mr Rort.
Funny about that mr Stop the Rort, my accountant sends me a doc to sign each year, nothing at all to do with Billable hrs at all, we simply negotiated a flat fee for service, he gives me a list of services, i agree in advance for a year, what the fee will be, go do your homework knucklehead.
Stop the Rort you have no idea what you are talking about
charging an hourly rate per job would be a hell of a lot more profitable.
This guy again. If a client knows how much they’re paying and what services they get for that fee and still signs up. Then, receives all the services they signed up for then where is the problem?
I pay my accountant a retainer actually. Not really a rort.
Does your accountant actually do anything for you though? Fee for NO Service is the only actual rort here, the rest is just collateral damage that will be incurred to ensure that the bad people go away
Except that a number of Accounting firms are moving towards flat fees (packages) for compliance work, which often includes a monthly fee. If the client knows what they are receiving for the advice and the fee being charged (Fee Disclosure Statements, signing off on review fees, Opt in), why would this be a rort?
Because we’re debiting people’s super funds on the most part for this fee. Super funds that were largely created to accommodate compulsory super SG. It’s now political. We’re going to be forced into re-thinking this. One idea I had was ensuring every new (and existing client if at all possible or practical) had a CMT set up by the firm, specifically for advice fees. We need to cease debiting people’s super funds…as I can guarantee, we will be made to very soon. The best case scenario is the government lets us charge a maximum ongoing advice fee per year, but we all should know what that will look like.
Yep. Fair or not, I agree that some sort of ban or limit is coming
because it isn’t a rort. you got a troll down below.
Beware, there’s a troll in the house…
Wait till ASIC investigate the “fee for service” rort.
No adviser will be safe and every licensee will be questioned.
If i were a dealer group or an afsl I would be starting to get your advisers to justify every single fee for service contract and start tailoring them to that individual.
You won’t be able to justify a flat fee for every client and your bi annual hour long meeting will not justify your fees. Portfolio reviews and rebalancing won’t cut it either.
You need to start charging like an accountant with a billable job rate based on hours.
Justify all you want. The “fee for service” RORT and it is a rort, won’t stand up in court for most of your clients best interest. It’s in YOUR best interest but that’s about it.
Clients can turn off adviser service fees at any time, are you suggesting that clients are unable to exercise their free will ? All gets a bit nanny state really. If clients don’t see value they can simply turn a post FOFA fee off, just tell; the product involved and off it comes. If they are unhappy they will, if not then the agreement is made and fees are payable. Clients are generally adults so reasonable to assume they can make a few adult decisions.
i think the industry will go to billable hours in time as you say, following a clean out. Im not sure its fair fee for service is a rort. Its comes down to how much they pay, and what service is provided. If the service is commensurate the fee, it will stand up in court (rather FOS), really not sure where youre coming from here?
I 100% agree and I dont understand all the – on your comment, this is the future and its best for the client.
You would be so much fun at a BBQ, Steven.
Agreed. Right or wrong, it will be enforced upon us. We are the guardians of people’s wealth and a big chunk is compulsory superannuation and concessionally taxed at that. Clients might still want to pay for services but it won’t be coming out of their super. Best we all start planning ahead. These changes will be rapid and harsh. We are not well liked at the moment. All those BDMs and business coaches you paid to help segment your clients into gold, silver, and nothings….you better phone them up and ask what’s the plan B.
Hey Mr Billable hours, aren’t heaps of accountants charging a set fee, regardless of hours for a service agreed, eg. SMSF Accounts and Audit ?
And aren’t heaps of accountants charging clients a annual fee, then getting it paid monthly, just like fee for service Financial Advice payments ?
plenty of accountants & lawyers I know have moved away from billable hours, price jobs based on the value that it delivers and charge it monthly
Yes, they do, but not from people’s super funds