Extend legal privilege to planners says FPA

The Financial Planning Association (FPA) wants relationships between financial planners and their clients to be entitled to the same legal privilege as that which exists between lawyers and their clients.

The FPA has used its 2017/18 Budget submission to renew its argument for "advice privilege" to be granted to qualifying communications between planners and their clients, arguing that in the legal profession it is regarded as the right of the client.

"This privilege is considered a right of the client rather than the (legal) professional, and it has its roots in the notion that fairness and public interest require a client being able to make full and frank disclosures to their professional adviser without the risk of prejudice and damage by subsequent compulsory admission," it said.

Related News:

The FPA submission said that extending professional privilege to other advice relationships was something which would be consistent with recommendations of the Australian Law Reform Commission and urged that the Government deliver ‘statutory provisions to ensure all practitioners receive professional privilege, in defined circumstances, relevant to the areas of law they provide advice in (i.e. taxation, superannuation, social security, etc)".

The submission said it was widely viewed that legal professional privilege (LPP) was necessary to ensure proper administration of justice but under common law, LPP only extended to the client-lawyer relationship.

"In 2007 the Australian Law Reform Commission (ALRC) delivered a report, "Privilege in Perspective: Client Legal Privilege in Federal Investigations", which reviewed LPP in the context of federal investigatory bodies," it said. "….one of the major recommendations of the ALRC report was that privilege be extended, in defined circumstances, to include tax advice provided by accountants."

The submission noted that such an extension would formalise the accountant's exemption and would bring Australia into line with the position in the United Kingdom, the US and New Zealand.

"It was noted in the 2007 ALRC report that the fact that the same advice can be given by accountants and lawyers on taxation matters as the crucial factor in their push for the extension of privilege to taxation advice. On the same basis this should also extend to financial planners providing the same advice," the FPA submission said.




Related Content

Advice, member education key to default fund selection

Superannuation funds that offer financial advice and member education should be better regarded for selection as default funds, according to the Finan...more

Women remain more concerned about finances

One in four Australians have indicated acute stress levels over finances, with women (37 per cent) much more likely than men (22 per cent) to feel ‘...more

Planners struggling under regulatory burden says FPA

The cost of regulation risks strangling small financial advice firms in circumstances where, in the near future one piece of personal financial advice...more

Author

Comments

Add new comment