The Senate’s inquiry into Dixon Advisory and wealth management companies more broadly lapsed at the end of the last Parliament and, despite the Financial Advice Association Australia (FAAA) expressing confidence it would be “remounted”, the economics references committee has chosen not to pick it back up.
According to a document that committee chair Jane Hume tabled in the Senate this week, the committee met on 31 July and “resolved to not recommend that the inquiry into wealth management companies be readopted”.
The inquiry was one of two that had not been resolved at the time the last Parliament was dissolved, with the inquiry into micro-competition opportunities being readopted.
FAAA chief executive Sarah Abood said the association is “deeply disappointed” that the committee will not continue the inquiry.
“This important inquiry was launched in September last year, to investigate the collapse of wealth management companies (such as Dixon Advisory), and the implications for the sustainability of the Compensation Scheme of Last Resort (CSLR),” Abood said in a statement.
“The decision to end the inquiry seems extraordinary, particularly in the light of recent news about the collapse of Shield and First Guardian, potentially involving over $1 billion in consumer losses from their super.
“This scandal makes it clear that the issues the inquiry was investigating are not resolved, and that the misdeeds at Dixon Advisory are not an isolated case. It betrays the victims, and all consumers, who have put their faith in the government to fully investigate these collapses so we can understand how they happened, and what can be done to prevent them in the future.
“We call on all members of Parliament to support the reinstatement of this critical inquiry, with an extended remit to include the collapse of Shield and First Guardian.
“We owe it to the victims not to walk away from this.”
Senator Pauline Hanson moved a motion in the Senate for an inquiry into the collapse of Dixon Advisory and its impact on the CSLR in September last year, with its approval welcomed by the financial advice sector.
“Today marks a major step forward for our profession, and we want to thank Senator Hanson for her support in seeking transparency and for backing Australia’s small financial advice businesses in proposing this inquiry today,” Abood said in September.
The continual delays in progressing to hearings had previously caused the reporting date to be moved back four months from March to 28 July – which clearly signalled the inquiry would need to be closed down and then restarted.
However, there was a broad expectation that the inquiry would be picked back up, with FAAA general manager policy, advocacy and standards Phil Anderson noting last month that “the FAAA is now working closely with the financial services minister and the shadow minister to get the inquiry remounted”.
“Both parties have indicated that they support the inquiry and we are currently going through the processes required to do so,” Anderson said on LinkedIn.
“There is no indication that this won’t succeed. The FAAA continues to believe an inquiry is essential to understand the full scope of what went wrong with Dixon Advisory and to ensure it is not repeated.
“The recent experience with Shield and First Guardian emphasises the importance of an inquiry into such matters.”
Has Pauline Hanson said anything?
Jane Hume is the gift that just keeps on giving…
Do not let her get away with this corruption!
Well this just exposes who was responsible for the Dixon failure… Jane Hume / incompetent & self-serving politicians, which we know anyway. So no inquiry required.
ASIC, Treasury and our politicians from both sides are utterly conflicted, biased and corupt. Australia is the wild west, where those in power, do favours for their mates in the large institutions and cover up their misbehaviour. They skillfully use the media and their position of power to whiteant, blame and frankly abuse financial planners, the vast majority of whom are honsest, hard-working small businesses and individual employees.
After working as a financial planner for more than two decades, I am ashamed of our regulators and law makers.
Those consumers who can afford to have a good financial planner on their side, don’t know how lucky they are.
Has anyone looked at who the members of the Senate Economics Committee are?
If you do have a look, you’ll probably throw something across the room.
The inquiry needs to be on CLSR. Dixon is gone, you can’t change that. We know the mistakes, its vertical integration. Nothing new.
But we CAN change the incentives for future companies going bust and getting paid out by the rest of the advice industry. Which is exactly what the CLSR is doing.
Who foots the bill? The advisers left in the industry.
AFCA and CLSR needs to make a big change. Shail Singh needs to go!
I don’t think the failure was solely vertical integration.
I was hoping to see ASIC get ripped a new one for being asleep at the wheel…. again.
Perhaps a criminal investigation into the role of Treasury and Government into the creation of CSLR and influence on changing AFCA rules, to facilitate the payment of funds back to Treasury employed clients of Dixon who lost money is required. Disgraceful, corrupt, conflicted conduct from the government.
Definite corruption. As soon as they scratched the surface, they realised it was going to embarrass too many of the wrong people.
Why look for a root cause when you can just keep sourcing funds from advisers to pay for any problems?
It’s extraordinary that Senator Jane Hume, as committee chair, has cancelled the Dixon Advisory inquiry – given she was literally the Minister for Financial Services when Dixon collapsed in January 2022.
But here’s what makes this truly remarkable: look at the AFCA determinations coming through for Dixon clients. Many aren’t actually for capital losses – they’re “but for” calculations about opportunity cost. These clients didn’t lose their principal; they’re being compensated for what they could have made if they’d been properly advised to invest elsewhere.
This is a wealthy, powerful client base – senior Canberra public servants, former department heads, government insiders with significant SMSFs – who largely preserved their capital while Dixon collapsed. Yet they’re still drawing millions from the Compensation Scheme of Last Resort (funded by levies on all financial advisers) for missed opportunities.
Even more concerning: senior Dixon staff now work within Treasury itself. The very department overseeing financial services regulation now employs people from the collapsed firm. Is it any wonder the inquiry has been quietly shelved?
And let’s not forget the breathtaking phoenixing operation. Evans & Partners hoovered up Dixon’s affluent client base and advisers while the company went into administration. The wealthy clients kept their capital, moved their accounts to E&P, and now get CSLR payouts for opportunity cost – while ordinary advisers across Australia foot the bill through increased levies.
The decision to scrap this inquiry sends a clear message: when your client base includes the Canberra elite and your alumni network extends into Treasury, even a spectacular business failure can be managed without proper investigation. The system protects its own.
Some advice for Sarah Abood – how about use the word “angry” for once.
Disgusting.
Your fkn kidding me! What are they trying to cover up???
My sense is the FAAA gave this issue a good go, but nothing trumps a few cheques changing hands to fund the next election.
Jane Hume is disgustingly corrupt in covering up her own failures.
Along with the whole of Canberra proving they are all corrupt and take zero care or responsibility for their massive failures.
Total cover up from Govt, Treasury, Dixon’s, MIS fraud and failures, ASIC inaction and of course the most corrupt addition of CSLR back dating only Dixon’s to pay Treasury & Govt employees scammed by Dodgy Dixon’s.
Nerida Cole has successfully buried these reviews in her Treasury desk.
FFS it’s enough to make you want to become a Sovereign Citizen.
It’s hard to keep going in this industry when everything is stacked against you. This is also more proof (if it was ever needed) that the FAAA are meaningless in the Government’s eyes.
Such a good point about keeping going.
The deck is stacked. The weight of evidence supporting this is enormous.
That’s not entirely true. Talking to the FAAA allows them to then say they have consulted with the industry. They don’t give 2 hoots what the FAAA thinks, but at least they can say they spoke to industry. At least the FAAA has some role I guess, even if it’s a counterproductive one
There’s a good example of how corrupt the system is. What a disgrace. Is anyone going to actually do anything to stop this crap from happening?
Someone must be pop champaige tonight. I am sure there are some background deal being reached. Jane Hume -who voted for this woman ? Liberals will pay for this !!!
Given Hume was the assistant minister, and then minister of financial services at the time of the Dixon’s collapse, can anyone explain to me how on earth she sits on a body that has any decision-making capacity about the collapse of wealth management companies during that period?
This stinks. A#se covering of the highest order. Alarm bells and sirens should be sounding throughout parliament.
The only explanation is Canberra Govt corruption and burying Dodgy Dixon’s MIS disaster.
Advisers are so used to corrupt Canberra stacked against us.
But this has gone way too far:
– Govt paid for 1 Dixon’s CSLR case not 1 years of claims as they were meant too.
– Govt retrospectively have Dodgy Dixon’s MIS disaster CSLR covered and no other past failures.
– Govt / Jones excluded MIS from paying any CSLR levies regardless of MIS fraud and failures widely known.
– Govt / ASIC fail to regulate Dodgy Dixon’s with 10 years of 60+ Adviser lodged complaints.
– Govt / ASIC allow E&P to Illegally Phoenix 40+ Advisers and 3000+ clients from Dixon’s for $$Zero consideration.
– Govt / ASIC allow E&P to Illegally Phoenix a $16 million debt owned to Dodgy Dixon’s for $$Zero.
– And then Govt force innocent Advisers to pay for it all via CSLR.
GET STUFFED CORRUPT CANBERRA GOVT.
ADVISERS / AFSLs MIST BOYCOTT ON MASS CSLR.
LETS SEE GOVT / ASIC try to close every AFSL & Adviser down in one go.
Appalling behaviour by Jane Hume, how does she sleep at night? Morally corrupt
Jane Hume loves to abuse Financial Advisers at all costs.
Can someone please explain to me how exactly the FAAA benefits members?
You’re forgetting they host a few golf days around the country.
Oh, forgive me, I wasn’t aware. How spectacular.
What salaries do the top brass pay themselves to sell Australian financial planners out again?
Jane Hume is at it again!!!!
After presiding over the trainwreck that was the financial planning portfolio in government, she’s now swung the axe at the Dixon Advisory inquiry — the very one that was supposed to uncover how thousands of Australians were burned, how the government snoozed through the crisis (ignoring every warning from advisers), and how the CSLR is now being dragged into an unsustainable sh*t show.
You almost have to admire the consistency: every time advisers or consumers inch toward accountability, Hume slams the shutters down. Accident? Please. This reeks of a political cover-up and some serious @rse-covering. Meanwhile, the directors of E&P Financial Group must be popping Champagne corks in relief.
If the Liberals think this is a pathway back to credibility, they’d better check the map — because this isn’t strategy, it’s self-sabotage. Less “clever politics” and more “shoot yourself in the face with a cannon, reload, and then ask for applause.”
Those of us financial planners still standing have long memories.
Shame on you, Hume (AGAIN).
Wow…so we fund ASIC through a levy to regulate and avoid these situations, then we pay another levy to compensate losses that occur when that regulation by ASIC fails. Those that do the right thing and stay in business pay for the ones that do the wrong thing and go out of business….when did that become morally and ethically acceptable and where else is this practice applied in our society?
Imagine if the building industry (for example), had to pay not only for the oversight of its own Building Code, but also for a fund to remediate defects on their handiwork? Everything would stop overnight. This is not a profession I can see young, clever finance graduates flocking to anytime soon.
Why not – let’s leave this to the remaining advisers to pick up the tab via CSLR !
Absolutely despicable.
So the two Directors of Dixon Advisory implicated in the collapse and now working for Treasury, likely be thrilled that Jane Hume who was the minister at the time has dropped the investigation into this scandal.
Politicians will never accept responsibility for their actions.
Hard to see this as anything but a disgrace. Why Do I keep voting for the libs? Once again, small businesses and honest advisers are left carrying the can while a giant like Dixon Advisory walks away without real accountability. Their collapse has already dumped the cost onto the rest of the industry via the CSLR, and now the Senate has chosen to avoid real scrutiny. This isn’t support for consumers or small advice businesses—it’s letting those responsible dodge liability and passing the buck to everyone else.
You actually vote for the Libs? What else did you expect?
Jane Hume – enough said
please give me 3 minutes to cook the microwave popcorn before posting comments….
Appalling government
I’m honestly lost for words. This is absolutely disheartening and highlights just how disconnected our politicians are from the realities of our industry.
Not disconnected but utterly corrupt.
This is a massive cover up from Govt, Treasury, Dixon’s, MIS fraud and failures, ASIC inaction and of course the most corrupt CSLR back dating.