ASIC reserves right to intervene in adviser recruitment
The Australian Securities and Investments Commission (ASIC) has given itself the scope to intervene in financial adviser recruitment processes to inform prospective licensee/employers whether financial advisers have had issues with the new Single Disciplinary Body (SDB).
ASIC has stated that while it will not generally notify current or former licensees of action being taken against an adviser “where ASIC considers it appropriate to do so, we may give information to an AFS licensee about a person we believe is or will be authorised as a financial adviser by that licensee”.
Responding to industry submissions on the proposed operations of the Financial Services and Credit Panels which will form the SDB, ASIC not at least one industry submission which recommended that both current and former licensees be notified of actions against an adviser.
However, ASIC has made clear that financial advisers will only be identified if the gravity of their wrongdoing warrants them being struck off the Financial Adviser Register (FAR).
“We will generally not notify:
- current AFS licensees if a proposed action notice has been issued in relation to a financial adviser authorised by the AFS licensee; or
- former AFS licensees of all FSCP outcomes and decisions relating to a financial adviser who was previously authorised by the licensee.
“However, where ASIC considers it appropriate to do so, we may give information to an AFS licensee about a person we believe is or will be authorised as a financial adviser by that licensee,” the ASIC document said.
Elsewhere in its response document, ASIC noted that some industry submissions had urged that the regulator provide further guidance on education standards for specific areas of advice such as self-managed superannuation funds (SMSFs), margin lending and aged care.
It said that in assessing a financial adviser’s fitness and propriety, ASIC might consider:
(a) is competent to provide personal advice to retail clients on the relevant financial products they are authorised to provide personal advice on (as demonstrated by their knowledge, skills and experience); and
(b) has the attributes of good character, diligence, honesty, integrity and judgement.
“We do not consider that the competency requirements of new financial advisers should differ from those of existing providers. Additionally, we note that under the Better Advice Act, the Minister is responsible for setting the education and training standards for financial advisers, including any standards relating to specific areas of advice,” ASIC said.
This is exactly the kind of egregious regulatory overreach which is killing the advice sector!
This is insane centrally planning by public bureaucrats who have never worked in the private sector 😡😡😡
ASIC will be telling you what to wear each day to the office soon with no doubt a code of fashion excellence, RG 0 – “No Idea.”
If they did that it would be a departure from ASIC’s usual approach. Far more likely they will issue vague guidance like “wear what’s appropriate for the circumstances” then persecute you after the fact for wearing light blue instead of dark blue. They would justify their action based on “some financial planner in the past did something wrong, and because he wore light blue, every other financial planner who has ever worn light blue must be viciously persecuted”.
I sincerely hope that the Single Discisplinary Body is an interim body, like FASEA, in the process of transfering the responsibility of the financial planning emerging profession to financial advisers. Otherwise making advice more affordable is but a pipe dream.
I sincerely hope that the “Single Disciplinary Body” becomes a single disciplinary body. Need to get rid of another 6-7 disciplinary bodies before that can happen though.