Major non-aligned financial services groups Findex and Synchron have welcomed the Financial System Inquiry’s indication it will be investigating the case for separating independent and restricted advice.
The FSI panel, chaired by David Murray, handed down its interim report on Tuesday, requesting, among other things, further stakeholder feedback on the case for introducing greater distinctions between independent and product manufacturer-aligned advisers, as has been implemented in the UK.
In response to the report, Findex Group – which describes itself as “Australia’s largest non-aligned and privately owned financial advisory company – issued a statement welcoming the report’s “focus on the benefits of independent advice”.
“We believe that our industry can only thrive if we focus on building trust with our clients,” said Findex chief executive Spiro Paule.
“We are opposed to a model where the providers of advice are also the manufacturers of the products recommended.”
Meanwhile, risk-focused dealer group Synchron – which describes itself as “Australia’s largest non-institutionally owned financial services licensee by adviser numbers” – has also welcomed the FSI’s indication it will investigate licence ownership issues.
“We have been saying for some time now that there is a significant conflict when financial services products are owned and distributed by the same parent organisation,” said Synchron director Don Trapnell in a statement.
“While the advice given by an adviser in a vertically integrated advice firm may very well be sound, the client has a right to know if any product recommended by that adviser is manufactured by the same organisation.”
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