By Mike Taylor
A REPORT into the Financial Services Reform Act (FSRA) commissioned by major accountancy body CPA Australia has suggested that advice provided by real estate agents and property developers should be covered by the same rules and regulations that apply to financial planners.
The report sampled the views of 820 investors throughout Australia and concluded that consumers were encountering problems with the advice they received from real estate agents.
The research found that of the 58 per cent of those who had sought advice on investment properties in the past five years, 17 per cent had problems with the advice and 10 per cent were unhappy with the advice they received.
It said that of the 61 per cent who had sought loan advice in the last five years, 9 per cent had problems with the advice.
CPA Australia’s financial planning policy adviser Kath Bowler said consumers were certainly encountering problems when they received advice about purchasing an investment property or taking out a loan, and these problems could be addressed by expanding coverage of the FSRA.
However, she warned that if the FSRA were to be expanded, careful consideration and consultation would be required with respect to the definitions to ensure there was no repeat of the mistakes of the past.
