Futuro reports frenzy of post-FOFA movement
Despite warnings from the Association of Financial Advisers (AFA) that now is the wrong time to change licensees, six new authorised representatives have joined Futuro Financial Services in June, with an additional four expected to join in coming days.
In a statement, Futuro managing director Dennis Bashford said the new recruits were not coming from one source but from a range of large and small dealer groups and self-licensed arrangements.
He said that that many were “eager to secure the future of their business given the challenges they face from the FOFA reforms” – with some indicating their previous AFSL was not properly set up for the new regulatory environment.
“Planners have had enough of the uncertainty caused by financial markets and regulation,” Mr Bashford said. “They are looking for stability and clarity in how they operate their businesses. They are understanding that to maintain and grow profitability they will have to do things differently that they have done in the past.”
Mr Bashford said the movement “goes against expectations because most believed there would be little activity in the immediate wake of FOFA while people sorted out what the impact would be”.
Earlier this week, AFA chief executive Brad Fox told ifa that because the full impact of the FOFA grandfathering provisions are still unknown, that in the short to medium term, advisers should stay within their current AFSL arrangements.
“We are working very closely with Treasury and the relevant ministers at the moment on understanding the full implications of the grandfathering regs,” Mr Fox said.
“At this point my main message to the advice market would be: if you are thinking of joining a new licensee – particularly if you are an older business – then wait!
“The issue could be that if an adviser has grandfathered revenue with a licensee – if they moved to a new licensee that revenue would not go with them to the new licensing arrangements it would stay with the old licensee.
“You need to wait and be sure of what the regs mean in practice as they could have significant implications for you as an adviser, for your business and client.”
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