“No education and training, no registration, no advice,” Fiducian Financial Services argued in its submission to the Quality of Advice Review (QAR).
Although it believes “greater clarity” on what advice is, would go a long way to formulate how it is regulated, the firm argued that regulations should not be “written or softened to appease groups or cohorts seeking lower standards”.
This argument was particularly aimed at “alternative advice providers” or influencers, with Fiducian arguing that “if we are to give the respect that the profession deserves”, anyone who wishes to provide advice of a financial nature should have completed the educational and training requirements.
“It will lift standards, the number of advisers and ensure quality advice is provided. No education and training, no registration, no advice,” the firm said.
The firm also contended different categories of advice, noting that “advice is advice, and must be full and comprehensive advice that is provided by a qualified financial adviser/planner”.
For this, Fiducian noted, a fee needs to be charged that is “sufficient” to compensate the adviser for their education, specialised training, experience, skill, ability to develop an appropriate strategy, and successful management of their business and staff to help the client achieve their retirement and lifestyle goals.
Whether or not financial influencers (finfluencers), in particular, should be regulated has been at the centre of an ongoing debate — one that former financial services minister Jane Hume often engaged in.
Namely, Ms Hume didn’t hide her sometimes controversial view of finfluencers, referring to them as the latest iteration in a long line of consumers sharing views about financial markets, not unlike “taxi drivers giving stock tips”.
“People have been offering free financial advice or free tips for forever and a day. It used to be in the 1930s what was it they said ‘when the bell boys start giving you stock tips it’s time to exit the stock’, taxi drivers, whoever it might be, there’s been lots of advice out there from friends, family and strangers for forever and a day, and I think most Australians are sensible enough to be able to distinguish between financial advice and a tip from a stranger,” Ms Hume said in May.
Speaking at the AFA Evolve Conference in September last year, she argued against government intervening, noting that the real threat to advise comes from fraudulent members of the industry.
However, despite her arguments to the contrary, the corporate regulator published an information sheet in March on how the law applies to social media influencers and licensees who use them.
This was widely backed by the likes of the Financial Planning Association of Australia (FPA), which had separately asked of the 47th Australian Parliament to better regulate finfluencers.
Keep the standard, reduce the red tape of compliance.
The problem is no one knows what a perfect advice document is. ASIC gives vague statements expecting you to interpret what they mean. Sadly if you go and see 5 advisers, you’ll get 5 different opinions/experiences and 5 very different statements of advice. Even the example Statement of Advice available in RG 90 (provided by ASIC) does not illustrate what they would consider to be the best advice. Also it is one of multiple possible outcomes. For insurance it Statement of Advice, failed to give alternative price comparisons insurance. They didn’t meet their own criteria. If the regulator can not clearly tell us, and we read all their documents and statements, how are we expected to get it right.
makes perfect sense… do not water down education standards but change compliance and licensing regimes as well…
This may be appropriate for new entrants, but is a complete insult to practitioners of 30 years who have kept their ongoing Continual Professional Education hours up to date. By hounding out another 50 percent of the remaining advisers, millions of Australians will never access advice again. Fiducian is pricing themselves out of the market by promoting a Rolls Royce Fee system, which is not serving the needs of most consumers today.
Totally agree with AF, I’m 65 this month & been in the industry for donkeys and recognition of prior learning(RPL) needs to be given credence. Elite attitudes and pricing will be the death knell for some dealer groups
I totally agree with this article and Tony,
Its actually an insult we have these planners who dont want to meet the educational standards yet want a carve out and still think they can be professional.
Our industry (not profession) has always been asking for carve outs.
Remember the grandfathered CFP’s, the accounting exemption, the limited licence, and now stockbrokers and risk writers want a carve out.
Just do the education.
For most it is only 2-6 units of a 8 unit course and you have until 2026 to complete it.
Then your comments will be more relevant.
Oh and by the way….I am over 60, 35 years experenced and have already completed the FP masters. I didnt have a degree.
Well said