Commenting on the release of ASIC’s Consultation Paper 329 this week, FPA chief executive Dante De Gori told ifa the association was in the process of reviewing the specifics of ASIC’s proposals around fee consents and independence disclosure, which were “critical issues for the profession”.
Mr De Gori said as a whole the royal commission should still be viewed as “another positive step towards the professionalisation of financial advice”.
“It was necessary to call out the misconduct and accelerate changes that were already underway,” he said.
“We need to call out bad behaviour where we see it, whether that be to the other person, to licensees, to associations or to regulators. As a profession we should expect and support action to be taken to protect consumers.”
Mr De Gori added that the association was discussing ASIC’s draft legislative instruments and the regulator’s proposal to issue further guidance around fee consents and independence disclosure with its members and would respond to ASIC shortly.
“The FPA is committed to progress in the financial planning profession by engaging with key stakeholders on major issues impacting the industry,” he said.
The comments come following the release of the regulator’s consultation paper, titled Implementing the Royal Commission recommendations: Advice fee consents and independence disclosure, on Tuesday.
In the paper, ASIC said it would develop three legislative instruments outlining the written consent fee recipients must receive from clients before arranging to deduct ongoing fees from a client’s account; the written consent super trustees must receive from members before allowing ongoing fees to be deducted from their account; and prescribing requirements in the statement providing entities must include in their financial services guide around lack of independence.
The list of requirements the regulator proposed in its guidance around fee consent forms advisers will need to give their clients annually include:
- The name and contact details of the account holder;
- An explanation of why the account holder’s consent was being sought;
- The services the client was entitled to receive under the arrangement;
- The frequency, amount and time of each payment deducted from the client’s account;
- Details of benefits in the account that could be eroded because of the fees;
- The expiry date of the consent; and
- The option for the client to withdraw their consent at any time.
Dante DeGori is almost as far removed from reality as experienced by the average Aussie as is ‘commissioner’ Hayne, and THAT is saying something. It is[i] beyond a travesty [/i][i][/i]that someone as insular and out of touch was in charge of making such important recommendations on insurance and investment planning advice delivery. After 34 years in the industry I’d thought I had seen it all until this hayne creature started making pronouncements from upon high about things of which he had zero experience and was CLEARLY [b]unqualified[/b][b][/b] to comment upon. How on earth was this allowed to happen and [b]where [/b][b][/b]is the proper outcry?
I saw this guy at the Royal Commission…not sure….something about taking 12 months to handle a complaint about cashing out a Government defined benefit fund, in return for not blowing the reputation of a media personality….not sure…as it would be very odd if he was still the CEO…wouldn’t it? Certainly not the person to be representing your members to Treasury. Didn’t Chief Justice Haynes say “industry associations can’t be trusted to be code monitoring bodies”
Hang on….now I think of it, didn’t I see him also, being accused in the AFR of remaining silent during the CBA advice scandal ( that lead to FoFA) in return for new members…not sure again, but I think Adele Ferguson made that accusation. Oh well…good luck lobbying change to Treasury “Ya’ll will need it”
I haven’t seen one single item to have come from Hayne that actually benefits or protects clients/consumers. Plenty to benefit ASIC and their staff’s powertrip attitudes, but nothing to benefit clients.
Didn’t call it out previously when they had knowledge of misconduct from some of their members. Solid organisation.
Wow. What a poor response. Thanks Dante. I look forward to telling my clients their money will be eroded away if they engage me for advice. Enjoy your cushy job in the public service or an institution, because you are clearly using your position as a stepping stone to other endeavours. If you had any interest in the long-term viability of our profession, you would be slamming some of these draconian measures and demanding the Government and ASIC stop blaming financial advisers for the failures of big business.
Given the FPA is owned and run by the Big 4 banks and AMP, as if they would do anything against their masters.
““We need to call out bad behaviour where we see it, whether that be to the other person, to licensees, to associations or to regulators. As a profession we should expect and support action to be taken to protect consumers.”
Have you called out ASIC yet?
I think planners were calling out ASIC about Storm Financial well before the crash and also it took them years before they would do anything word on the street is this was largely due to storms sending in SOA’s and getting the tick of approval much like the Industry fund tick of approval with 50% pass rate what a joke
I’ll happily call out the AFA and FPA
Two faced hypocrite….won’t bite the hand that feeds you.
Dante for PM – he is already so good at getting paid big bucks to be completely useless, with zero ethics and can easily tell people black is white, whilst he smiles right at you.
What a complete joke Dante & FPA are.
Karma will get you one day Dante !!!!
The funny thing is, that if he were PM it would actually be a pay cut.
Most advisers certainly do “expect and support action to be taken to protect consumers from poor advice”.
Consumers are receiving very poor advice every day from unregulated websites, and unlicensed accountants, mortgage brokers, and property spruikers. Something should certainly be done to stop this.
But where is the regulatory focus? On drowning licensed advisers in expensive bureaucracy and paperwork, which makes things more difficult and expensive for their clients, and ultimately pushes them into the arms of the unregulated providers. How is this protecting consumers?
So where was FPA’s role in protecting consumers all this time? So RC is basically addressing the failures of industry bodies?
Yes Dante, more regulation, its helping consumers alright….. take a look at LIF, its really helping consumers pay much more for their insurances, and Insurers themselves are purely thriving mate. Take a look at the costs of SOA’s, consumers are ecstatic at paying 50% more for advice, in fact they are lining up at the door to get it. Now consumers are really going to love signing 15 different pieces of paper to pay an ongoing fee. I have clients asking if we can make it 20 pages of forms to sign and 500 page SOA’s – the more disclosures the more they understand they reckon. On top of this Advisers are loving it, just 16 suicides, but if we can get some more regulations in maybe we can increase that number. We should actually pay Dante $800k a year for his outstanding contribution to the advice industry.
Does that mean when I buy a car in future, the dealer should ensure that I am aware of how this will affect my bank balance.
The intent of the current changes is to make life as difficult as possible for financial advisers. It only pays lip service to protecting the public as the public will receive less advice, advice that is more expensive and more bureaucratic.
Eventually the consequences of this will be felt but we are a few years away from abandoning the current scorched earth policy that kills everything except the cause of all the bad advice – product providers selling through financial advisers they control or can influence substantially. There is something hilarious about it, like one of those silent movies where the cop is looking everywhere except straight at the villain who is standing next to him in some ridiculous, obvious disguise.