Addressing the AIOFP national conference in Sydney last week, Stephan Kasanczuk, director of Wolfthink Consultancy and a former ASIC staffer, suggested advisers need to choose their clients wisely.
“You only need to choose one wrong client to ruin your practice and make your life a misery,” he warned.
As part of this approach, he encouraged advisers to refuse clients whose needs fell outside of the adviser’s skill levels.
“Always advise within your experience and skills. That’s going to become very important,” he said.
With the full reinstatement of the best interests duty, his key suggestion for advisers was “document, document, document”.
“You need to document every single contact you have,” he said.
“Every phone call. Even if it’s a recorded message, make sure you record it.”
Under the new regime, the management of conflicts of interests also needs to be recorded well, he warned.
“Even if you are doing the right thing, you can still get caught out,” he said.
He encouraged advisers to be vigilant of small details that could support a client’s complaint.
In his experience, FOS once rejected a claim by an adviser because the client’s signature was in a different handwriting to the date on the document.
Lets face it, if you are a planner your life already is a misery.
For once, the truth. Not everyone is your client !!!!
Sadly, given a choice, the courts will believe your client over you. Read the Harrison case if you doubt that statement. The judges actions in that case is not the first, and it won’t be the last time client won the fight.
As a former ASIC staffer myself and involved in AFSL compliance, I can appreciate the need for documentation but even choosing the right client and documenting everything, your life can still be made a misery if a complaint is lodged.
All I see these days are attempts to put band-aids on problems rather than key stakeholders taking a step back and looking at the industry as a whole.
Everyone has their own agenda in relation to this industry…it’s a pity they are not shared by all players.
In a competitive market who will pay for all this record keeping? I am a one man business and must provide the services to earn income, not shuffle paper like a public servant.
Document document document….and now we have more documents to produce and can get caught out even for doing the right thing. Charming.