The financial advice professional standards reforms include obligations for financial advisers to, from 1 January 2020, comply with a code of ethics and be covered by an ASIC-approved compliance scheme under which their compliance with the code of ethics will be monitored and enforced, ASIC said in a statement.
The code of ethics is being developed by the Financial Adviser Standards and Ethics Authority. Consultation on an exposure draft of the code of ethics released by FASEA closed on 1 June 2018.
ASIC pointed to RG 269, which explains its process and criteria for determining whether to grant approval to a compliance scheme. It also sets out:
- expectations for the governance and administration, monitoring and enforcement processes, and ongoing operation of compliance schemes;
- how ASIC will exercise its powers to revoke the approval of a compliance scheme and to impose or vary conditions on the approval; and
- the notifications that monitoring bodies must make to ASIC.
ASIC deputy chair Peter Kell said it is committed to ensuring robust, transparent, fair and consistent compliance schemes that effectively monitor and enforce compliance with the code of ethics.
“Effective compliance schemes are a key component of the reforms that will require higher standards of ethical behaviour and professionalism among financial advisers,” Mr Kell said.
“Our guidance requires high standards for compliance schemes, reflecting the significant responsibility that monitoring bodies operating compliance schemes will have. This includes the responsibility to effectively monitor and sanction adviser members if required.”
At this time, FASEA has not released the final code, ASIC said. If there are significant changes from the draft code, ASIC noted it may revise its guidance when the final code is released.
ASIC offering guidance on an ethics scheme under the purview of a separate body which, by the way, has not been released yet.
No doubt given the 15-mth timeframe involved from ASIC and with FASEA yet to finalise anything, 3 years from now there will be 90% non-compliance, and we’ll find out once again how recalcitrant this industry is.
The Public service in action. Try making sense of that.
Hopefully Haine will see ASIC is not doing their job , so the will establish a new group with experienced advisers on that panel with legals etc for a common sense approach .
Yes. Whatever happens in the next 18 months. Ahh.. how about a simple requirement , that already exists, that Licensees fully supervise and ensure that all advice is compliant and in best interests … And full compo to clients if they dont, …… ohh hang on , that’s is what Terry McMaster at Dover was actually doing ! and the banks were not. ( I actually don’t think they know how) . Solution? Suck up to the banks and AMP, destroy Dover, then propose some stupid outsourcing in 18 months of the task that Licensees and ASIC should be doing anyway. Very confusing,
you have a point there. class action against ASIC ?
Whats the point of having an individual named in a AFSL if they aren’t held accountable? Oh wait thats right, they are held accountable as long as they aren’t part of a big bank or AMP.
Ho hum. ASIC and the industry can’t enforce the standards we have now.
Hey ASIC, how about some monitoring of Banks and Insurance Company CEO’s, Executives and also the dame bloody Government Regulators / ASIC / APRA – ALL of whom have been shown at the RC to be sorely lacking any idea of what ETHICS are.
Ahh that’s right let’s blame the Financial Advisers again and load them up with more red tape and regulation. It’s always the Financial Advisers fault. WTF !!!!!!!!!!:evil:
” We all deserve a body that will actually offer something of value to us for the fees”. Exactly what I have been saying about financial advisers for years. But I do not expect any positive outcome in my lifetime.
Although there are some bad apples, most advisers already offer significant value for money and have done for a long while. I guess that must make you the walking dead.
Fine. How about as the regulator, ASIC also adhere to a consistent approach themselves to “expectations for the governance and administration, monitoring and enforcement processes, and ongoing operation of compliance” overview? If an audit were done of how ASIC actually operate themselves compared to how they expect us to operate, they would be banned!!
Who or what org would provide monitoring? How exposed would they be to liability?. What then if anything is the role of an AFS licensee ?. Isnt this level of compliance monitoring ecactly what Dover were doing ?.
Let’s wait and see how serious they are about change, FPA and AFA should not be granted this status and a new fresh organisation be introduced due to their disgusting lack of ethics and conflicts that have been uncovered. We all deserve a body that will actually offer something of value to us for the fees.
Well said. agree. Doctors would be a joke if you gave the Australian Medical Association code monitoring authority and allowed them to have a major sponsorship from a Tobacco Company. Communities expectations are much higher.
You can’t have a body that gets conflicted remuneration from the likes of CBA Financial Planning, AMP, NAB, Bridges and then expect them to priorities planners and Australians interest. We will never be taken seriously when a relationship like that exists.
but Dante has 4p’s and 4F’s he is so cool and does nothing. let’s keep him and give him more authority
NO!
What’s the bet that Kell, like Sanders, soon pops up at some commercial organisation trying to cash in on the explosion in compliance bureaucracy.
Odds on…LOL!!