In its submission to the Senate inquiry into its performance – released yesterday – the corporate regulator recommended a number of policy changes to help it weed out unethical operators, including a new register for some financial advisers.
“Under the current financial services regulatory regime, authorised representatives must be registered with the [Australian Securities and Investments Commission] ASIC. However, there is no central register for employee representatives,” the submission states.
“This means that ASIC has no direct oversight of employee adviser representatives, including those who provide personal advice, and must rely on licensees to ensure the competence and integrity of these representatives.
“This can result in very real difficulties in ASIC’s ability to locate and take action against bad apples in the financial services industry,” it continues, adding that the regulator has struggled to keep track of individual advisers, following the collapse of a licensee.
Specifically, ASIC has called for an extension of its powers to register all individuals licensed to give financial product advice, as well as incorporate extensive employment history information.
Other jurisdictions such as the United States and UK “currently administer or are moving towards individual disclosure and accountability of regulated advisers”, the submission points out.
In August, the regulator flagged its concerns that licensees were not adequately scrutinising the history and record of prospective authorised representatives.
I would like to know what the percentage of PI claims are between employee advisers (EG Don Nguyen) -v- Authorised Representatives, that would give a concise and balanced view of where the bad apples really are and expose how lame ASIC’s “monitoring & supervision” of the industry really is!
The public view of the financial planning industry has been tarnished with all the attention it gets from ASIC and the former cancer-ridden labor government, specifically Bill Shorty. Why don’t they turn their attention to ISN financial planners and see how many rats desert those sinking ships!?! Oops silly me that won’t happen because it requires common sense and they probably don’t want to crap where they eat!
Always good to know that the ’employees’ providing advice aven’t been checked. ASIC should be closed down for this alone. What a useless, waste of space. Consumers have every right to claim for misrepresentations made that they were being protected. Who’s responsible? ASIC or successive governments? Either way, massive FAIL and need a clean out, starting from the top.
its the first step to creating that elusive level playing field for all concerned BUT the industry guys also MUST be added to the criteria. All the hype and BS disappears (maybe ) then
I would have thought all advisers needed to be registered with ASIC, employed or contract. This is just another failure to properly implement and administer the powers aleady granted by existing legislation.
Gerry, you can rid yourself of the “vampire”, just get your own AFSL.
The employers (banks, industry funds) can register them now as individual authorised reps – why don’t they? ASIC could start the clean up by treating these employers the same way as they treat the independants Licensees instead of allowing the “employers” to hide their bad apples.
ASIC, if you’re to go down that path, why can’t we just get rid of licensees…the ones who arguably caused the rot, own product and distribute it, and suck the blood out of adviser revenues. If you’re not satisfied they are monitoring their advisers, then why support that model? I’d be happy to pay you a direct licensee fee to rid myself of this vampire called a dealer group.