Reflecting on half a century in the financial services industry, the directors of non-bank dealer group Synchron say they will continue to lobby against over-zealous regulation, urging licensees and advisers to do the same.
At an event in Sydney on Wednesday to commemorate the appointment of former Synchron adviser Matthew Wallis as the licensee’s new NSW state manager, Synchron chair Michael Harrison said the industry should not take unwarranted government intervention lying down.
“Right now we have a monumental challenge in this industry ,” Mr Harrison said.
“We have LIF, FASEA, the new Australian Financial Complaints Authority – which will probably have an impact on PI premiums – and a political class that simply doesn’t understand our industry and has a blinkered approach.
“We could sit down and accept all this or we can adapt and prepare. We need to be prepared to stand up for ourselves.”
Synchron has organised upcoming meetings with Minister for Revenue and Financial Services Kelly O’Dwyer and other influential policymakers with the intention of explaining the impact of government reforms on financial and risk advisers and their clients, the independent chair and former Zurich executive revealed.
In the past year the licensee has met with former prime minister Tony Abbott, foreign minister Julie Bishop, finance minister Mathias Cormann and speaker of the House of Representatives Tony Smith, in an effort to advocate on behalf of its advisers and the broader industry.
“I’m not hopeful that it will change the whole situation but at least they will know where we stand,” he said.
Adopting a historical analysis, Mr Harrison reminded guests of the Whitlam government’s decision to end tax-deductibility of life insurance, comparing it to the current state of affairs in financial services.
“I remember going to a meeting and half the [life agents] said they would leave the industry because of it and they did,” he said.
“But ever since then the industry has grown, things have gotten better. Sometimes you just have to take a step back while the storm passes by.
The dealer group’s five-year and ultimately successful battle with the Victorian State Revenue Office over what it argued was an unfair assessment – which cost Synchron $750,000 in legal fees – confirmed to the company that some fights are worth fighting, even where difficult or expensive.
“Sometimes you need to take a position and hold that position,” he said.
In a passionate speech following Mr Harrison’s address, Synchron director Don Trapnell reiterated that he is willing to lobby government on behalf of advisers in the absence of other industry leadership.
“You need to get angry if it deserves getting angry. You don’t just say ‘its going to go away’,” Mr Trapnell said.
“We need to stand in front of the minister and MPs and harangue them. We need to speak to product providers and other licensees. We need to talk about it, debate and engage.”
He said he stands by comments published by ifa this week that the FASEA requirements may "kill" the risk advice specialisation, arguing that debate is needed to ensure the viability of the industry he has been involved in for 50 years.
Aside from the lobbying agenda, the Synchron directors said their main priority is helping authorised representatives prepare for the new mandatory standards regime.
“Some will need education help and might be studying for years, some are going to need a succession plan and unfortunately others will need an exit plan,” Mr Harrison said.
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