Tax-style “high audit” system proposed for advice space
Financial advisers’ high regulatory burden is the product of a system that wrongly fails to distinguish “high risk” and “low risk” advice, an adviser believes.
Just as the tax system delineates higher risk players with a “high audit” status, so too should financial advice regulators, according to MEDIQ Financial managing director and AFA Rising Star Ravi Agarwal.
“The people who are providing advice 'low audit’ advice, things like making sure they have the right superannuation and insurances and they have a plan and are working towards financial goals shouldn’t have the onus placed on them to prove that they are not double gearing into a property fund,” he told Money Management.
Agarwal believes the failure to separate riskier financial activities from those offered by everyday advisers is damaging client/adviser relationships and the profession’s perception among the wider community.
He said anything involving complex exposure that is difficult to articulate to the client, such as derivatives, should be subject to rigorous regulatory guidelines, but retail advice should be subject to less scrutiny.
Recommended for you
The central bank has released its decision on the official cash rate following its November monetary policy meeting.
ASIC has cancelled the AFSL of a Melbourne-based managed investment scheme operator over a failure to pay industry levies and meet its statutory audit and financial reporting lodgement obligations.
Melbourne advice firm Hewison Private Wealth has marked four decades of service after making its start in 1985 as a “truly independent advice business” in a largely product-led market.
HLB Mann Judd Perth has announced its acquisition of a WA business advisory firm, growing its presence in the region, along with 10 appointments across the firm’s national network.
