ASIC’s behaviour, rather than the advisers in question, is our primary target in giving oxygen to the regulator’s media releases.
Hardly a day goes by that ASIC does not send a message directly to my inbox heralding its work in removing another 'bad apple' from the advice industry, listing the individual’s name and hoping there is some subsequent public shame.
But last week, Terry McMaster, director of Dover Financial Advisers and a longstanding member of the non-aligned community, fought back, penning a strongly-worded piece calling out the regulator for this particular PR strategy.
“Anyone can make a mistake,” Mr McMaster said, adding that the adviser in question is usually just the “little guy at the end of that very long and very conflicted product distribution chain”. He also pointed out that there is often a “cruel” flow-on effect to the families of named and shamed advisers and called on ASIC to supplement this media strategy with some positive content that actually helps advisers, like a list of common SOA mistakes.
The dealer group boss makes some very good points, but his impassioned plea is likely to fall on deaf ears.
While Mr McMaster is right that advisers often take the fall for nefarious behaviour further upstream, this reflects a problem with the law itself (rather than ASIC’s enforcement of it), whereby advisers have duties of care that boardroom execs and product manufacturers sadly do not.
In addition, his suggestion that ASIC should counterbalance its “character assassinations” with some proactive content for advisers would likely be met with derisive laughter from ASIC officials who have made clear they have no interest in helping the advisers succeed and would frankly prefer the industry to be replaced by robots.
Mr McMaster also took issue with the “financial press”, which he said “instantly plagiarise(s) and re-publish(es)” ASIC propaganda.
As you might have noticed, ifa is particularly quick to distribute these updates from ASIC, but we also agree with the premises of Mr McMaster’s blog, so it is worth explaining why we do what we do.
“Plagiarised” might be a little strong, but he is right to say that in the first instance we tend to redistribute ASIC enforcement updates pretty much verbatim, without analysis or investigation at this initial stage.
We do this not to shame the individual mentioned (though some of ASIC's targets do deserve this), but to provide a transparent record of ASIC’s media strategy. While it may seem we are contributing to the “cruelty”, running these stories is part of our role in holding the regulator to account and we consider it our obligation.
For example, if ASIC is sneakily trying to paint people as “financial advisers” when they are more accurately accountants or stockbrokers (as it often does), this can only be discovered if we report what ASIC says, rather than burying the story. If ASIC’s enforcement activity focuses on independents and one-man-band businesses instead of the big end of town, again this is far more visible when we ‘newsflash’ than if we are silent.
And of course, we encourage passionate members of the community like Mr McMaster to not pull any punches and to voice their concerns publicly – even when they are criticising us!
In the meantime, you can expect to continue to see us publicise ASIC’s statements and for the advice community to continue clicking.
But that doesn’t mean we endorse the regulator’s strategy. In fact, it sometimes means the opposite.
Aleks Vickovich is managing editor at ifa
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