ASIC and APRA claim misunderstandings on personal advice
Both the Australian Securities and Investments Commission (ASIC) and the Australian Prudential Regulation Authority (APRA) are insisting that there is a misunderstanding around the collection of superannuation fund member data and the delivery of personal financial advice.
In a joint presentation to a Canberra conference, representatives of both regulators sought to clear up confusion around the Retirement Income Covenant, with ASIC’s Superannuation and Life Insurance team leader, Jane Eccleston making clear that collecting member data does not equate to delivering personal advice solutions.
“…when we say that analysing member data can help trustees further enhance their choice architecture, in no way are we suggesting that trustees must use the data they have collected about their members to deliver them personal solutions that are designed specifically for that member,” she said.
“Nor do we think that the collection of member data somehow automatically translates into a requirement or obligation to provide personal financial advice or means that any future interactions the member has with the fund will involve the provision of personal financial advice.”
Eccleston said that, often, discussions around the Retirement Income Covenant very quickly become a discussion about the challenges of personal financial advice regulation.
“Fundamentally superannuation funds are product providers and, like other financial service product providers, cannot realistically have a business model whose success is entirely contingent on making individual product recommendations to customers,” she said.
“More pragmatically, the question for super funds to ask is what can be done to make sure that:
- the products available are high quality and meet members’ needs;
- members’ decision-making about these products is supported appropriately so that the chances of members’ ending up in a product suitable for them are maximised and ending up in a product not suitable for them is minimised.
And of course, as these are generally long-term products. This is not a set and forget situation – essentially, every day a member stays in a product they are implicitly making a decision to stay in the product.”
What a bunch of claptrap bureaucratic BS double speak.
We start with “in no way are we suggesting that trustees must use the data they have collected about their members to deliver them personal solutions”.
Then we move on to ” done to make sure members’ decision-making about these products is supported appropriately”.
Well if I can’t opine at a BBQ, where NO clients are present, about whether BHP may or may not be a good investment nor can I be specific about our managed account changes in case someone WHO IS NOT ADDRESSED on our distribution list reads it, we can be guilty of implied advice, failure to produce an SoA blah blah blah.
Yet a super trustee with personal information is NOT providing even implied advice, let alone actual advice, to “support members decision making” regarding a product???
Both the trustee and I have an AFSL and yes I acknowledge they are different but this regulatory quicksand environment created by cretinous regulators is now even starting to consume them. Even they don’t understand the pathetic and ridiculous mess they have themselves created.
Yet they have stood on top of their no accountability ivory tower and hurled rocks at us for decades.
Muppets.
100% correct they have no idea what utter madness, mass BS over regulation they have created.
And worse they have 0% idea of how to unwind it in any meaningful way.
Of course these same Canberra bubble bureaucrats take ZERO RESPONSIBILITY for the Gordian Knot of crap they have ALL created.
A perfect example of how little they know. They make comments such:
“And of course, as these are generally long-term products. This is not a set and forget situation – essentially, every day a member stays in a product they are implicitly making a decision to stay in the product.”
But the RIC is trying to force Lifetime Pensions to be sold. And guess what, those pensions can’t be commuted, can’t be changed, can’t make decisions about.
Can’t what for the mass amount of complaints when people are sold over the phone by a Back Packer a Lifetime Pension and then want to exist as they didn’t understand what it was when they want some extra lump sum funds.
Useless Canberra bubble bureaucrats.
essentially, every day a member stays in a product they are implicitly making a decision to stay in the product.”
Really? I thought we had to assess the continuing suitability of a product at each annual review. And compare it with alternatives and make file not why it’s still appropriate.
If ASIC and APRA were being honest they would have said…
“The law is sufficiently ambiguous, and our powers sufficiently draconian, we will decide what and how to regulate based on our own biases and prejudices. Rest assured our primary focus is the persecution of all licensed financial advisers including the honest, professional, majority. Union super funds, accountants, and finfluencers can do whatever they like and we will ignore them.”
It just gets worse by the day.