The Australian Securities and Investments Commission (ASIC) today released consultation paper 212 (CP212), which proposes to retain the current training standards in RG146 as ‘base level’ standards, and to introduce two further regimes of training.
These are proposed to come into effect in 2015 and 2019 and will increase generic knowledge requirements, specialist knowledge requirements for financial planning, securities and superannuation, skill requirements for personal advice and educational level requirements.
ASIC has designated current requirements as ‘Regime A’ with ‘Regime B’ to commence on 1 January 2015 and ‘Regime C’ to come into play on 1 January 2019.
ASIC is proposing to make all generic knowledge requirements for Tier 1 advisers mandatory. Under RG146 Tier 2 products are deemed to be simpler and better understood, and therefore subject to lighter training standards and a lower educational level.
There is a need to raise the educational level of advisers providing personal advice on Tier 1 products from AQF Level 5 (equivalent to a Diploma) to AQF Level 6 (equivalent to an Advanced Diploma), ASIC stated.
ASIC’s previous CP153 consultation proposed a number of improvements including a national exam and knowledge update review.
“It is important to note that if a national examination is implemented, it may replace any obligation to do a training course approved in writing for advisers of Tier 1 products,” ASIC stated.
‘Tier 1 products’ refers to all financial products outside of Tier 2, which includes general insurance products (except for personal sickness and accident), consumer credit insurance, basic deposit products, non-cash payment products and first home saver deposit accounts.
ASIC’s consultation paper can be viewed here.
Here a thought – how about the government start investigating consumers every day rip offs like the ar servicing SCAM. You know the one, where you drive into to an Audi, bmw, mazda, holden etc etc etc service centre & theyre sizing you up on a schmuck scale as to how much they can bend you over for undoing a nut & draining some oil & or transmission fluid. Audi wanted $3500 plus for a simple 100k service that when you drill down into whats done it should only cost no more than $400 MAX! Similar rip offs across the range……its endless scams that can cripple the average family by the big car companies. Oh wait there isnt any overpriced courses they can flog IS there? No chance of fixing thisbthen.
Yes Sam , we all know about those client books but eventually natural attrition will fix that without drastic intervention. They’re not likely to just dump the investment because it pays a .40 trail are they? They’ll only pay a fee elsewhere, in fact prob cheaper to stay put when you think about it. And how do we know they’re not being serviced.? Advisers probably invite them for a review, up to client if they want to pay a visit or not.
Gerry it is more the thousands of inactive dormant clients that are paying commissions to advisers they don’t even know that is the issue. We all work in the industry so lets talk openly and honestly!
A ban on commission restrospective Sam…are you serious? I’ve got some small clients on commission trail and they’re very happy with that. If I charge a fee they’ll run for the hills. I’m happy to accommodate their occasional queries without billing them….bit of pro bono actually coz I’m a nice bloke.
You can’t turn back the clock and destroy decent business and alienate smaller clients. The latter are already left right out of FoFA.
I’ll keep my smaller clients if I can, sorry about any new ones though…they’ll have to got it alone or fork out for my rather expensive invoice. I’m post grad degree qualified and an enshrined professional….I now only look after the wealthy.
Having a degree doesn’t make a person moralistic or ethical. How many advisers have clients in commission paying products and are happy to keep them there to cover the costs of running their business. The ban on commissions should have been retrospective. The AFA, FPA etc fought for advisers on that exclusion. You’ve got to be able to cop the criticism that comes with that sought of thinking.
Xtefila, I always find broad and sweeping generalisations to be not only entirely true, but remarkably accurate and useful. Thanks for the advice.
B Eng (Hons), MBA (Sub FIN), GDFP (SIA), SPAA SMSF accredited specialist, JP. All-round Good Guy. LOL
Here we go again! EDUCATION EDUCATION EDUCATION…….the e all & end all according to asic, the FPA & all the other course floggers who are rubbing their hands with glee & ready to shove their snouts back in the EDUCATION SCAM selling overpriced templated courses online. WELL DONE FPA, keep up the stunning work of lining your own pockets under the covert tactics you started years ago.
Howvabout chasing the bad guys Asic? FPA? AFA?…….anyone?? Naaaaahhhhh, theres no fees in that hey boys!
xtefila, there really isnt any products left in the industry anymore.
yeah sure you can buy some insurance, but other than that most have blown up.
the issue is more over regulation which adds to the cost of running a business and ultimately to the end to a client.
The days of charging a client $30 a hour are over, whether that of been through commision,hourly rate, fixed fee whatever. Accountants, Lawyers, Stock Brokers, Life advisers, anyone who actually gives a damn to look at this industry properly now, the end to end process is expensive. More Regulation More Cost to the consumer unfortantely.
Not a word about ethics. Just so ASIC can say that advisers are better trained. For what.
These are the people who apparently will not look at the ” sales force quotas” now on display in the banks. All of those folks will have the correct bits of paper, but its all meaningless unless
morality and ethics are ingrained
Why anyone would want to go to a finacial planner for advices is beyond me. Most are product salesmen, who have never gone to university, or if they did go, they never completed their degree. Why not make it like true professions like lawyers and accountants, you must have a degree and you must have have continuous education. Those that are currently in the profession should sit an exam set and marked by ASIC. Not some Micky mouse organization that is happy to pass on pmt of fee. Watch then how the industry scrambles. Come on I dare u to do this.
Here we go again . Every time the regulator comes under pressure – bang- press release comes out to increase adviser education. The question needs to be asked – do the perceived problems of the advice industry revolve around advisers or holders of an AFSL ie the dealerships . If you look at the garbage advice handed out by CBA advisers, Storm Financial and various other groups, it is quite obvious that there is a problem at the dealership level .Make the dealers accountable and you would solve a lot of these problems . The CBA should have have had their dealership suspended as should a myriad of other dealerships. what happened ? they gave an unforceable undertaking regarding the Storm fiasco and not 3 years later we hear that nothing had changed . Every time one of these clowns goof off, more regulation is heaped upon advisers . Its a bit like saying I didnt know the gun was loaded but i promise not to shoot you again
hey i have a idea that ASIC sgould be focusing on. How about looking at all these failed Investment Schemes out there making sure they limit them from happening again, work out a solution for the investors, assist planners and advisers rather than blaming them or making up ridiculous stuff. All for education but the first option seems more important, just a silly idea i guess cause someone doesnt get paid a fortune to form a policy or put their name to something that helps i guess
According to the AQF website, attainment of an AQF Level 6 indicates that the holder “will have broad knowledge and skills for paraprofessional/highly skilled work and/or further learning”. Levels 7 & 8 equip one with the skills necessary for “professional work”. Levels 9 and above are appropriate for “professional practice”.
It seems to me that if financial advisers are really serious about being accepted as professional practitioners, then we should all be aspiring to AQF Level 9. Level 6 seems like an insult to the public.
This should of been made mandatory 10 years ago. I guess, it’s never too late.
Keep up the good work ASIC (Sarcism)