• subs-bellGet the latest news! Subscribe to the ifa bulletin

Former CBA staffer suggests new advice legislation

A 30-year veteran of the financial services industry and former Commonwealth Bank staff member has proposed new laws governing financial advice product recommendation.

In a submission to the Financial System Inquiry, Vince Doe, who describes himself as a financial planner who has been “involved in financial services for over 30 years having commenced working for the CBA at a country branch which had no computers”, suggested a new legislative structure for the industry.

“Simply I would legislate to ensure that no large Investment House with a significant position in the
industry could own more than 50 per cent of a fund that they recommended,” Mr Doe wrote.

“This could be achieved progressively with a divestment of say a minimum 10 per cent per annum over 5 years. The result would be a break in the nexus of the major players worrying about funnelling product into their own funds.

“Clients and advisers would then have more confidence that there was some independence of
recommendations for the approved [product] lists of the investment houses such as the large banks.”

Mr Doe added that while he believes FOFA provided some “good changes”, the industry requires a “small revolution”.