ASIC acknowledges gaps in robo-advice compliance
The Australian Securities and Investments Commission (ASIC) has confirmed its support for robo-advice even though it acknowledges substantial regulatory issues are yet to be resolved.
ASIC chairman, Greg Medcraft has told a FINSIA forum in Sydney today that the regulator sees robo-advice as having the potential to offer a convenient, low-cost advice service to consumers, and to also deliver benefits such as improved compliance and record keeping.
Medcraft also claimed that robo-advice had the potential to reduce conflicts of interest.
However, he acknowledged that the provision of robo-advice raised interesting regulatory issues and challenges including how robo-advice providers could comply with best interests duty and the training and competency of those sitting behind the robo-advice model.
Medcraft also acknowledged that unanswered questions remained about whether robo-advice providers could adequately compensate consumers for poor advice.
He said ASIC had set up an internal Robo-advice Taskforce to look at robo-advice issues, and was discussing the issues with robo-advice providers and those looking to join the space.
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