In a joint statement released late on Wednesday, Treasurer Josh Frydenberg and Assistant Minister for Superannuation, Financial Services and Fintech Jane Hume said the government would seek to respond to the royal commission’s recommendation around the single disciplinary body by handing the task to ASIC’s existing Financial Services and Credit Panel.
“The FSCP currently supports ASIC in the exercise of its regulatory functions with respect to the making of banning orders against individuals for misconduct,” Mr Frydenberg and Ms Hume said.
Expanding the role of the FSCP will leverage its extensive expertise and existing governance structures, avoiding the need to establish a new body to perform this role.”
The panel currently consists of a number of members active in the advice industry, including former AFA chief executive Brad Fox, Commonwealth Bank advice compliance executive Gaye Simpson and former MLC head of advice compliance Gayle Cilfone.
Mr Frydenberg and Ms Hume said consolidating the new function within ASIC would “avoid regulatory overlap and minimise the possibility of multiple investigations by multiple agencies into the same conduct related to the provision of financial advice”.
Following industry and political pressure that has dogged the authority around its implementation of the adviser standards framework, the government also moved to wind up FASEA and roll its standards setting powers into Treasury.
“Remaining elements of FASEA’s role, including administering the adviser examination, will be incorporated into the FSCP’s expanded mandate,” Mr Frydenberg and Ms Hume said.
“These reforms will further streamline the number of bodies involved in the oversight of financial advisers, resulting in FASEA being wound up.”
Legislation enacting these changes would be introduced to Parliament in the first half of next year, the statement said.
Commenting on the announcement, AIOFP executive director Peter Johnston said rolling disciplinary responsibilities into the FSCP was “a sensible decision”, and warned advisers to remember the scrapping of FASEA was “only the demise of the entity, not the rules”.
“We feel for Stephen Glenfield, who has done a great job in recent times under difficult legislative conditions to support the advice community,” Mr Johnston said.
Stockbrokers and Financial Advisers Association chief executive Judith Fox agreed that rolling disciplinary responsibilities into ASIC “makes sense”.
“It is a common-sense approach to have Treasury responsible for setting the education, training and ethical standards in the financial advice sector,” she noted.
“This will ensure alignment with the approach to policy arising from the Hayne royal commission recommendations.”
Get these fn executives off the panel. We need experienced, practicing advisers dictating our future, like every other profession
You’re kidding.
Brad Fox is involved again. I thought we had seen the last of that muppet. This industry is so conflicted and stuffed, mainly by people like Brad Fox.
Same FARSEAcal crap
Under Different FARSEAcal management.
Groundhog BS More REGS day again and again
A discipline body made up of execs from two of the least compliant organisations and Brad Fox who was instrumental in getting through the LIF which has proven to be the biggest disaster to ever happen to the LIfe insurance industry for customers, advisers and companies. Still at least we know what the 30 pieces of silver reward was.
It would be interesting to know if they could pass the ethics exam?
Vale FASEA, the body with an impossible mandate. It was requested to write an airtight code of conduct so that misconduct that was uncovered in the Royal Commission would never happen again. At the same time it was forced to allow vertical integration – in other words, it was tasked to treat the cancer of advisers selling their employers’ products without being allowed to treat the cancer directly. Hilarious if it wasn’t so sad.
Due to the impossibility of its mandate it was taken over by the universities smelling a pot of gold and quickly showed questionable behaviour itself.
Its mandate never included enabling advisers to be able to provide life insurance for Australians or investment advice at reasonable cost and it showed.
Perhaps the new bodies will consider the purpose of financial advice which is accessible and affordable life insurance and investment advice to more than the very rich as part of their mandate.
That first paragraph is completely on the money.
I’d also toss in that they had to also do it while maintaining the facade of the AFSL system’s suitability.
While I welcome the demise of FASEA, it seems silly to hand over responsibility for the exam to a completely new body 6 months before the final exam deadline for existing advisers?
What about FARSEAcal hasn’t been silly.
May as well make it even more stupid, bureaucratic Canberra bubble morons with zero real world implementation.
Oh good, the discipline board is made up of compliance executives from CBA and MLC, the two least compliant businesses in Australia. I suppose the theory there is that they oversaw such woeful advice practices that they can easily recognize them.
Seems like they are trying to untangle the spaghetti. However, as it is led by Treasury and ASIC along with wisdom from the compliance people from CBA and MLC I can only think that things will continue to be a mess.