The Government’s proposed financial adviser central disciplinary body has been directly referenced by the Assistant Minister for Superannuation, Financial Services and Financial Technology, Senator Jane Hume.
While the major financial advice bodies are still seeking details of the proposed new disciplinary structure, Hume used a speech to a Financial Services Institute of Australasia summit in Melbourne to canvass the disciplinary body as a central element of the Government’s approach to addressing adviser misconduct.
While backing the value of quality financial advice and referencing the important role advisers play, Hume said it was critical the industry was held to high standards and any misconduct eliminated.
“The Government is committed to ensuring Australia has a vibrant and well-respected financial advice industry. One that customers feel confident that the advice they get is the best advice for them,” she said.
“As such, the Morrison Government has increased the requirements for entities to investigate the full extent of financial adviser misconduct, introduced legislation to end grandfathering of conflicted remuneration and is establishing a new approach for disciplining financial advisers for misconduct through a central body.”
Hume’s comments come at the same time as the Financial Planning Association (FPA) and the other bodies making up a consortium to establish a Code Monitoring Authority have sought clarity about where the authority will sit in a landscape inhabited but not only the Australian Securities and Investments Commission (ASIC) and the proposed new central disciplinary body.
The central disciplinary body was recommended by the Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry and the Treasurer, Josh Frydenberg, outlined that both it and the Financial Adviser Standards and Ethics Authority would exist within the proposed new framework.
However, while financial advisers who sign up to the Code Monitoring Authority are expected to fund its operations, there has been no discussion around how the central disciplinary body would be funded and whether it would be separate from ASIC.
FPA chief executive, Dante De Gori, said the FPA was seeking clarity of the new regime in the context of the operations of a Code Monitoring Authority and any additional monetary imposts on members.