The SMSF Professionals’ Association of Australia has responded to the initial findings of ASIC's SMSF taskforce, saying the regulator’s claim about poor advice in the sector should be viewed “with balance”.
SPAA national technical director Graeme Colley told ifa the comments made by ASIC Commissioner Peter Kell to the CPA Australia conference this week could potentially lead to negative perceptions of the SMSF sector among consumers.
“If the message that’s taken out of [Commissioner Kell’s comments] is that poor advice is endemic within the industry, that’s an exaggeration and is clearly not the case,” Colley said.
“We are concerned that this is the way some people may perceive the comments,” he said. “We would hope people view the commissioner’s comments in a balanced way and understand that the vast majority of people will get at least adequate if not good advice in relation to their SMSF.”
Colley – who took over the role of national technical director following the move of Peter Burgess to AMP earlier this month – said there was a broader concern that the SMSF sector is often implicated in cases of wrongdoing by financial advisers.
“This often happens where a financial planner may have been found guilty of fraud in the courts and an SMSF is in some way involved. The SMSF angle seems to get all the attention in the mainstream press, rather than the general advice given by that person,” he said.
Responding to Commissioner Kell’s charge that some SMSF advisers have “room for improvement” in their explanation – or lack thereof – of compensation options, Colley said the responsibility lies with dealer groups.
“Information about compensation and dispute resolution options available to clients are really the responsibility of licensees, who should be ensuring that financial planners are in possession of that information and relaying it to clients,” he said.
“You would expect as part of training from dealer groups, that authorised reps are made well aware of the compensation and dispute processes and the obligations to explain this to clients.”
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