The public reprimand of Lionsgate is part of a wider regulatory move against independent financial planning groups, Angelo D’Ambrosio of ADA Group, a Melbourne-based Lionsgate practice, told ifa.
“Lionsgate is one of the few remaining non-aligned dealer groups left and this [ASIC communication] is just another case of a regulator trying to kill off the non-aligned dealers and their authorised representatives,” D’Ambrosio said.
“ASIC should pull its head in,” he added. “It says it supports full disclosure and fee-for-service and a ban on commissions – as do I – but then it puts out a statement like this about one of the few dealer groups that is doing the right thing and not just pushing products.”
Rejecting ASIC’s concerns over the resources apportioned by the 103-adviser licensee to supervising its authorised representatives, D’Ambrosio said in the 12 months since he joined Lionsgate he had received regular audits, compliance reminders and communications.
“The idea that they have not given their authorised reps sufficient supervision is complete [nonsense],” he said.
“Lionsgate actually allows you to be a real financial adviser and provide strategic advice rather than just flog products.”
D’Ambrosio said he regrets that authorised representatives have been tarnished by ASIC’s decision to publicly voice its concerns, claiming that a number of referral partners have reacted negatively to the news.
The regulator should “get its facts straight” and should consult with authorised representatives before publicly rebuking a licensee, he added.
Lionsgate authorised representative Andrew Newman of CMP Financial Planning has also defended his dealer group against the allegations.
“It hasn’t changed my perspective on Lionsgate; I’m pretty happy with their service,” he said.
“My understanding is that this is just ASIC doing spot checks and when they step in they’re going to find something.
“Everyone’s sick of the regulation. It’s a pain in the arse, but that’s the way its heading.”
CAF I actually agree with you on most of your points in the last message. However regulation by itself and in the current form isn’t the answer. The regulations in their current format does nothing to protect against agri failures, those leveraged ‘protected’ capital schemes that failed, or even really addresses the APL issue of dealergroups (let alone the nil advice allowed to be given by ISN’s). Empowering our professional asscoiations is one other solution, as is enforcing capital regulations similar to the bank’s requirements if organisations wish to create products. Yes it may be restrictive, and create less competition for the smaller players, however there are also likely to be less failures or frozen funds as a consequence. Penalising planners alone is not the answer, and yet that appears to be the mandate of the new regulations coming in.
It’s a crazy notion to believe that the regulator is the most efficient and most likely path to best interest for the client. By simply allowing free enterprise to run amok, you end up with situations like Storm. But when the regulator gets involved it means compromises and sometimes those compromises are harder to live with than the problem they are solving.
The regulator needs to embrace some free market realism. If they sat in a financial planning office and watched the time it takes to meet with a new client, discover their goals, determine a risk profile and then take the time to develop strategies, articulate those to the client and then implement them, they will soon learn that it takes time and wisdom and that we aren’t overpaid to do that service.
Your reply does not do your standing as a professional too much good, Sir.
CAF – seriously? You’re not tired of the over regulation? Wonder how many clients you actually see or assist and what mode of advice you deliver, because the excess regulations are literally killing off the IFA space – both at a dealer and adviser level. Which is exactly as the ISN’s desire, who have a direct link to the current Labor movement & Gov, who control the regulators. Anyone who isn’t concerned is simply an ant not looking up but busily working away, helping manufacture the insecticide.
PS – impressed to see the word ‘arse’ in the article! Good to see sentiment & straight forward talk published.
‘Everyones sick of the regulation.’
Not me – it was / is about time the old cottage industry of Financial Planning was / is regulated.
Everyone wants to be labeled ‘Professional’ – lets start walking the talk!