ATO warns accountants on robo-advice

The ATO has reminded accountants that are not licensed to provide advice that they cannot recommend automated investment solutions, as certain robo-advisers target this market.

In a website update, the ATO said that accountants who don’t operate under an AFSL are limited in how they can refer a client to an automated advice provider.

“Some robo-advice services may suggest that unlicensed accountants who refer clients to a robo-adviser won’t be providing a financial service; however, this may not always be correct,” the ATO warned.

“For example, an accountant can provide basic information such as robo-adviser contact details, but they can’t guide you through the process or endorse any advice provided by the robo-adviser,” the ATO clarified.

The ATO urged SMSF accountants who operate without an AFSL to be aware of their obligations where they refer clients to robo-advisers.

It also reminded trustees and professionals that any organisation that provides financial product advice through a robo-advice service must have an AFS licence or be a representative of an AFS licensee.

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Mayflower Consulting managing director Sarah Penn has raised similar concerns, highlighting the importance of unlicensed accountants establishing a clear divide between their services and the advice services being provided by the automated advice system.

“There is nothing wrong with [automated] advice, I’m actually all for it but the accountant can’t pass off that advice as being their own. They need to be very clear that advice is being delivered by a different AFSL through a computer system,” Ms Penn said.

“They can’t be discussing what the computer says in terms of advice, they can’t be trying to pass it off as their own. It needs to be quite a distinct hand-off to the computer system to deliver the advice.”

ATO warns accountants on robo-advice
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