At the end of the second round of royal commission hearings – which focused on financial advice and wealth management – commissioner Ken Hayne requested additional information from parties with leave to appear.
Those responses have now been made public and include a right of reply from witnesses on some of the more contentious issues raised by the royal commission, including ‘fees for no service’ conduct, inappropriate advice and in-house product conflicts.
The royal commission second round submissions can be accessed below:
- AMP
https://www.ifa.com.au/pdf/amp-submission-general-questions.pdf
https://www.ifa.com.au/pdf/amp-case-study-1-fees-for-no-service.pdf
https://www.ifa.com.au/pdf/amp-case-study-2-investment-platform-fees.pdf
https://www.ifa.com.au/pdf/amp-case-study-3-inappropriate-financial-advice.pdf
- Former Westpac adviser Andrew Smith
https://www.ifa.com.au/pdf/andrew-smith-submission.pdf
- APRA
https://www.ifa.com.au/pdf/apra.pdf
- ASIC
https://www.ifa.com.au/pdf/asic.pdf
- AFA
https://www.ifa.com.au/pdf/afa.pdf
- ANZ (and aligned licensees)
https://www.ifa.com.au/pdf/anz.pdf
https://www.ifa.com.au/pdf/m3-and-ri-case-study-submissions.pdf
https://www.ifa.com.au/pdf/m3-and-ri-supplementary-case-study-submission.PDF
- Former ANZ adviser John Doyle
https://www.ifa.com.au/pdf/mr-john-doyle.pdf
- CHOICE
https://www.ifa.com.au/pdf/choice.pdf
- CBA
https://www.ifa.com.au/pdf/cba-part-a-wealth-management.pdf
https://www.ifa.com.au/pdf/cba-part-b.pdf
- Dover Financial Advisers
https://www.ifa.com.au/pdf/dover-financial-advisers.pdf
- Finance Sector Union
https://www.ifa.com.au/pdf/fsu.pdf
- FPA
https://www.ifa.com.au/pdf/fpa-part-a.pdf
https://www.ifa.com.au/pdf/fpa-part-b.pdf
- Henderson Maxwell
https://www.ifa.com.au/pdf/henderson-maxwell-entities.pdf
- NAB
https://www.ifa.com.au/pdf/nab-general-questions.pdf
https://www.ifa.com.au/pdf/nab-case-study-supplementary-submissions.pdf
https://www.ifa.com.au/pdf/nab-case-study-supplementary-submissions.pdf
- Treasury
https://www.ifa.com.au/pdf/treasury.pdf
- Westpac
https://www.ifa.com.au/pdf/westpac-banking-corporation-financial-advice-case-study.pdf
https://www.ifa.com.au/pdf/westpac-banking-corporation-general-submission.pdf
And still the question remains, where is the RC inquiry on ISA funds, the known First Choice fee for no service problem or any investigation into them by ASIC or chastisement of ASIC for not doing one? The ASIC submission as described by Anonymous above regarding them having issues with no complaints on our ongoing fee collection is beyond belief, how about they act like independent professionals themselves and look actually where the dog is barking and not solely at us! Pathetic inept weak ineffectual and either corrupt or else have a biased agenda are the only reasons plausible.
don’t worry, the Industry Funds are preparing for the RC too….round 4 hasn’t yet been announced.
An increasing number of licensees & planners are outsourcing the compilation of SoAs to countries such as the Phillippines, India etc due to increasing cost & compliance pressures. Is this what the regulator(s) really want – financial advice being offshored outside Australia where there is less control over working conditions, lower wages and the potential for corrupt behaviour?
This isn’t a regulator issue, it’s a federal government issue concerning free trade.
ASIC – “The apparent absence of complaint by customers casts doubt both on the value to the customers of the ongoing services and also the method by which those services were being charged for and paid” – right, so because there have been no complaints by customers about fees for the service they received then there must be something wrong!!!!
“Although customers are notified of the fees deducted in their fee disclosure statements (and are subject to opt in……), ASIC is concerned that this may not suffice to bring the fact that they are being charged significant ongoing fees for service sufficiently to the attention of the customer” !!!!!! Unbelievable! Years ago, ASIC weren’t happy that fees were disclosed just as a percentage, ok, so we will disclose them in dollar terms too which will be clearly disclosed in the SOA. Still not enough, we want you to now send the clients each year a FDS which shows how much you have paid in the last year for our services, ok we will do that too – but hang on, because there haven’t been any complaints about this because they are only shown “as a line in a fee disclosure statement”!!!
For goodness sake ASIC, FEES are disclosed to clients every which way possible, do you want us to tattoo what our fee is onto their arm so that they are constantly reminded of how much they pay their adviser?????
The FPA are a disgrace – laying down and saying grandfathered commissions should be stopped and that life insurance commissions should be stopped in the future.
If they get rid of the Fee for Service arrangements and ban grandfathered commissions and move to invoicing directly (which ASIC have recommended) then the financial planning industry will be decimated.
CHOICE accepts/accepted payments from the Big Switch campaign, who take commissions. Part of this commission is paid to CHOICE to help subsidis their falling revenue from subscriptions. Their own people said that…after they got pinged for not disclosing this referral fee arrangement.
FPA and AFA have proven what has been known for many years – they are useless organizations that leech off financial planning and achieve nothing
very eloquently put Ross. Well done. [b]useless and leech[/b][u][/u] is a perfect description
I raise the comment about the AMP,S BOLR when the clients sit in the BOLr pool waiting purchase doesn’t t AMP have to handle any & all enquiries that iare raised by the client. any ,contributions, changes to details etc or financial advice that is required someone has to handle this in AMPs back office which is service for fees also while these clients seem to sit in limbo ( ASICs view) AMP are covering the FOS “& PI premiums which is a large costs in any practice which allow clients the safety to lodge a complaint and or litigate.
Comments are from an Advisor not from AMP
I don’t agree with it but interesting & good point. I think however the fee was quoted as an “adviser service fee” and privately negotiated with AMP advisers and so how can you charge a fee for something that is not there… that’s the RC side of the debate. I believe also they chose not to reduce the fee as it mean’t making grandfathered clients fall under the opt in regime when the fee is turned back on. (thanks AMP).
Meeting must take place within 12mths no proof that this wasn’t still going to happen as long as there agreements weren’t going to fall into this 90 day BOLR pool before being allocated to another adviser to look after.
I’ve read through all of those links and couldn’t find this – can someone please answer a question for me? Are insurance renewal commissions part of the ‘stop grandfathered renewal commissions’? I could only see a reference to superannuation in the pathetic FPA dribble. really appreciate knowing if anybody is certain. That would see me out and retired pronto. Cheers.
Can someone explain why CHOICE has made a submission… pretty scary reading… May as well close the industry now if grandfathered commissions go. This is madness… who benefits when there are no more plants?
FPA calls for Grandfathered commissions to be removed and fall under the opt-in and FDS regime. Breaking headlines there.
I’ve no comment on the above but the sheer arrogance of the FPA is shocking. They’re getting undisclosed and hidden payments (commissions/conflicted remuneration) from AMP Financial Planning/ Commonwealth Financial Planning etc etc and bundling them up (hiding them) and declaring them as members fees (deceptive) in their annual reports and they are the ones calling for commissions on grandfathered products to be removed! The lack of leadership for all these years in this area around the relationship of product and advice and now here we have the hypocrisy of the FPA in issuing this statement. it’s just disgusting and shocking. Just why renew member fees in June?
Thanks for the update.