The advice industry would benefit from new legislation protecting “good faith” disclosure of poor adviser conduct between licensees when conducting reference checks, ANZ has argued.
In its submission to the ‘scrutiny of financial advice’ inquiry, the banking group seeks to offer a solution to the easy movement of “people of bad character” between licensees, arguing there is scope for new protectionist laws.
“There is an opportunity for legislation to address this issue by creating a framework within which legal protection would be given to good faith disclosures made by licensees in response to reference checks,” the submission states.
“This would inhibit financial planners who had engaged in misconduct but had not yet been formally banned from moving from licensee to licensee.”
Under the current system, licensees often lack information about a prospective employee or authorised representative and are unable to assess past conduct short of a banning order, the submission contends.
Licensees are hesitant to provide this information during recruitment negotiations due to “actual or perceived legal restraints and potential liabilities”, it suggests.
At the same time, ANZ rejects the idea that this information should be made publicly available – such as including it on the government’s adviser register – arguing that publication may be “unfairly prejudicial” to an adviser and that it would “inhibit frank disclosure” between licensees.
The submission explains that ANZ supports, however, the inclusion of publicly available information regarding misconduct, such as bans or enforceable undertakings, on the register.
The Australian Small Business and Family Enterprise Ombudsman (ASBFEO) has refer...
FASEA has announced its August exam sessions will only be offered remotely for V...
A major platform provider has made changes to its functionality to make it easie...