The Financial System Inquiry panel has raised concerns about ASIC’s longstanding proposal to introduce a national examination for financial advisers.
While most of the FSI interim report handed down this morning was composed in a matter-of-fact tone or requested more stakeholder feedback – including on whether the UK divide between “restricted” and “independent” advice may be appropriate in the Australian context – the report also gave a rare opinion on the issue of a national adviser exam.
“ASIC has proposed introducing a national exam for financial advisers,” the report states. “Many other jurisdictions have national examinations: for example, Canada, Hong Kong SAR, Singapore, the United Kingdom and the United States.
“The risk of introducing a national exam is that consumers may place too much expectation on the regulator guaranteeing the competence of advisers who have successfully passed the exam.”
In addition, the report is seeking further feedback on whether minimum education standards should be raised for financial advisers, particularly those advising on “more complex products and structures, such as SMSFs”.
It has also requested further consultation on the proposed individual public register of financial advisers and whether greater banning powers over managers and executives should be given to ASIC.
More broadly, the report endorses the federal government’s mantra that “affordable, quality financial advice can bring significant benefits for consumers” and recognises that “comprehensive financial advice can be costly”.
As a result, the panel members have also requested additional engagement on the opportunities and feasible models for scaled advice.
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