Regulator releases reference checking protocol for advisers

Developed around the financial services royal commission’s recommendations, the ASIC protocol aims to improve reference checking in the financial advice sector.

Along with the protocol, ASIC has also released guidance documents to assist AFS and credit licensees comply with the new reference checking requirements.

"The ASIC protocol sets out obligations for licensees to undertake a reference check and share information on an individual seeking to be employed or authorised as a financial adviser or mortgage broker," ASIC said in a statement on Tuesday.

"The reforms will promote better information sharing about the performance history of financial advisers and mortgage brokers — focusing on compliance, conduct and risk management."

The news comes after the corporate regulator released IDR reporting documents set to be tested in a pilot involving financial firms later this year.

The pilot versions of the dictionary and glossary were developed through two rounds of public consultation and aim to ”align as closely as possible with the reporting approach of the Australian Financial Complaints Authority”.

Key changes made in response to the consultation include to remove free text fields and mandatory reporting of demographic information and to allow flexibility to including multiple products and or services and issues per complaint.

Neil Griffiths

Neil is the Deputy Editor of the wealth titles, including ifa and InvestorDaily.

Neil is also the host of the ifa show podcast.