Appearing during a House of Representatives standing committee on Thursday, FPA’s head of policy, strategy and innovation, Ben Marshan, discussed ASIC’s current SOA system.
“We have numerous complaints and disciplinary systems and processes that financial planners need to comply with,” Mr Marshan said.
“The only way that a financial planner and their licensee can be comfortable that they’ve got a defensible position if there is a consumer complaint against them is to document something that is around 100 pages long to ensure that every warning, every consideration, every recommendation is documented in such a way that if somebody picks up that document, they can find a defence for whatever the complaint is.”
Liberal MP Jason Falinski – who earlier in the committee called for the Hayne royal commission recommendations to be scrapped – slammed the current set-up.
“Are you telling me that of 100 pages that you have to hand out to clients, 92 of them are just to satisfy lawyers?” Mr Falinski said.
“Does that not strike you as not only absurd but obscene?”
Mr Marshan said that the current system has inspired them to commence work on a digital SoA.
“We’re working with ASIC to try and create a digital SOA that would effectively have no paper involved at all which would much better address the cost, the time to produce the SOA and what the client actually receives and delivers,” he said.
A due date on the digital SOA is yet to be announced.
So the FPA are now technology providers are they? They make it sound so easy to build a digital SOA, but an SOA, regardless of how it is delivered or created, is subject to the same complex, legislative burdens a paper based SOA is today. A single digital SOA cannot deal with all facets or complexity levels of advice. This is not fixing the core problems, but rather an exercise is either FPA profiteering, or more likely, a massive expensive IT project that will end in failure.
This is the problem. We are coming up with a 100 page digital SOA rather than making an 8 page paper SOA.
As long as you have 100 screens to view the digital SoA on it should work as well if not better than the paper version…
So the FPA is using our member fees to create a digital SOA that will no doubt be issued at some cost, rather than using our membership fees to fight against the ridiculous legislation that has brought about this need.
Profiting from their own ineptitude?
Based on ASICs previous hopelss attempts at putting forward their views on SOAs, I couldn’t trust them to come up with a workable “document” for this either. What they have proposed in the past would never have stood up to a complaint via FOS / AFCA and left the adviser/licensee to carry the can.
How about they look at ways of reducing our regulatory burden so that we can them reduce the size of all SOAs.
They also need to remember that “Digital” does not suit many older retiree clients.
WE lost commissions, we now have LIF, we also have FASEA, annual opt ins required, ASIC fees insanely high, AFCA charging massive fees even when advisers win cases and advisers being treated like criminals at every step. It is hard to see any wins by the FPA in this space.
Contrast above with the MFAA who came out hard against attacks on their industry and consider if the FPA has any value at all!
Falinski, like just about all MPs, doesn’t seem to even bother to read, let alone understand the legislation the parliament produces. For him to be supposedly surprised at the absurd complexity of SOAs, is insincere and incompetent.
Um no, if you bothered researching, Falinski was previously in the FP industry so is all too aware of the issues at hand.
But good on you, Labor or ISA stooge, for trying to throw some shade on Jason’s attempt to actually assist our profession and being one of the few actively standing up for us planners, I am sure you’re hoping the complexity gets worse for us, the levy gets higher and there’s less of us pesky planners in business?
How do we know if the FPA is not working with ASIC to create this digital SOA just for the big bank “members” to allow them to come racing back into FP to rape and pillage again under a robo advice model??
Who and how can you trust ASIC??????????????? FPA breaches my code of ethics when it comes to trustworthiness.