Adviser challenges super fund fee cancellation decision
A senior financial adviser has raised client privacy issues in the face of a having the Australian Retirement Trust (ART) cancel the deduction of is advice fee from a member account.
The adviser, Warren Loudon, of Loudon and Vaughan Private Wealth, went public with his concerns after receiving notification from the ART that, under its Adviser Registration Terms and Conditions, it was cancelling his fee.
Loudon used social media to claim that the ART had demanded he provide his client’s personal information so they could check his work to ensure it was appropriate for the client.
“I managed this client’s account for free for two years before finally putting a fee on the account because nobody can work for free.,” he said. “My client has not authorised the sharing of their non superannuation and other personal details with this provider and as such I could not and will not provide them with this information.”
“My licensee viewed the work I have completed for the client and passed this information onto the Australian Retirement Trust but they were not satisfied. Now they are attempting to punish me financially because I will not share the clients Statement of Advice with them. This is a very small client but it is the principle that matters,” he said.
The ART in cancelling the advice fee referred to its Adviser Registration Terms and Conditions which, within its Advice Fee Policy, requires financial advisers to “provide any or all of the following documents for the purpose outlined in this Clause:
- The relevant sections and/or a complete copy of the Statement of Advice;
- the relevant sections and/or a complete copy of the Record of Advice;
- Client Services Agreements (or variation of this Document Type);
- other evidence of the advice services provided or to be provided.
“A request of this nature may be made by Australian Retirement Trust in respect of any or all members for which you have submitted an Advice Fee Request,” the ART document said. “The Fund will collect and where required retain documentation in accordance with the Privacy Policy, Privacy Act and other applicable privacy laws (refer to section 4).
- Failure to provide documentation
You acknowledge that a failure or rejection by you to provide documentation upon request can result in the following:
- The cancellation of the Advice Fee, which is the subject of the documentation request;
- The cancellation of any or all your Advice Fees;
- The revocation and cancellation of your access to the Service; and/or
- A ban on any or all functions provided by the Service.
Yep wonderful for super funds to now be another complete layer of BS compliance.
Super Funds need to be Super Funds, not Advisers, not AFSL compliance officers.
Get stuffed ART.
And ART is supposedly the most “adviser friendly” of the union super funds. Union super has had a long running approach of misusing admin processes to delay, frustrate, and undermine third party advisers trying to help their clients.
This is why switching clients out of union super funds is often in the client’s best interests. What the unions don’t get, is that many advisers would be quite happy to leave their clients in those funds, as long as the fund administrators were cooperative and supportive of the advice process.
When will people learn that it isn’t their money, it is the union funds money. It doesn’t matter what the client wants it is up to the union fund to decide what happens to money in their funds. Of course actions like this will be fully endorsed by ASIC who have demonstrated time and again that union funds can do no wrong.
Saw the original post and find it more concerning that the adviser had ‘privacy concerns’ yet posted his client’s full name on social media. Doubt the client authorised that either.
I’ve had this before. It’s a complete joke to be honest. In what world should super trustee be scrutinising advice! Obviously ASIC & APRA are too incompetent to realise how absurd this is.
In a world where they have a fiduciary duty.
Which applies in the form of Best Interests Duty to the Adviser and their licensee in the first place, so it’s basically a doubleup.
Incorrect. Trustees have a fiduciary obligation to ensure the SPT has been adhered to. That is not the licensees responsibility to check or govern but the trustee.
This is why Australian super offers qantas FF points for people who are willing to open a new account, direct SGC and a rollover. SPT is a laugh, these a money hungry and greedy fat car super funds who think they are above reproach and answer to no one.
as opposed to the retail funds, who only care about profit to shareholders, regardless of poor member outcomes?
Lol, SPT – just like Qantas points, union director fees, political donations, sports sponsorships? Were the super funds checking for FFNS? Where did the responsibility, and the fines paid come from for FFNS? Yes, Advisers & licensees. So what is the point of a super fund checking an advisers fee?
I maintain, that super funds checking adviser fees against SPT is essentially a double-up. The responsibility lies with the adviser and their licensee. I understand super funds have a fiduciary duty, but maybe they should get their own backyard in order.