In a statement issued this morning, IFAAA president Daniel Brammall said ASIC’s stance is a “step in the right direction for the Australian public”.
“We are delighted that the ASIC has provided clarity on the use of the term ‘independently-owned’ as we have felt, for some time now, financial planners who aren’t independent but promote themselves in this way is potentially misleading,” Mr Brammall said.
The IFAAA has been lobbying ASIC for some time on the “misuse” of terms it deems synonymous with ‘independent’.
However, Mr Brammall also expressed disappointment with ASIC’s opinion that accepting asset-based fees does not prohibit an adviser from legally using the term ‘independent’.
Members of the IFAAA will still be required to forgo asset-based fees in order to comply with the association’s Gold Standard of Independence, the statement said.
“We can see why they would take that view, even though we don’t agree with it. At the end of the day, it’s an opinion, it’s not the law,” Mr Brammall said.
“Our view, which is also supported by legal advice, has always been that asset fees are incentives and incentives are a conflict of interest.”
We’ve all seen on here the almost religious zealot fervor in comments that members of the IFAAA spruik – essentially, theirs is the only way that planning should be done and all else is evil… No surprise then they support this misguided nonsense by the SIr Humphries living in theoretical ASIC land…
No surprise here. While S923A does little to help consumers, it is a fantastic marketing tool for IFAAA. I’m sure they lobbied very hard for the ASIC to restrict broader use of their marketing tool.
Meanwhile the IFAAA website (and the website of many of its members) uses the misleading and deceptive claim that they offer advice without any conflicts. Unless they are providing advice for free, then this is a false claim. Fee for service advice is still conflicted.
ASIC and IFAAA are doing consumers a complete disservice by categorising some methods of payment as conflicted and others as conflict free. All this does is prevent consumers from accessing payment methods that may be in their best interests.