Advice industry suffers from spike in suicides
Consistent and continuous regulatory change over the past decade has exacerbated the mental health of advisers to the point that more people in the industry are dying by suicide, according to Infocus chief executive Darren Steinhardt.
With only 61% of advisers passing the September Financial Adviser Standards and Ethics Authority (FASEA) exam, Steinhardt said it was disgraceful that no journalist or politician had brought up the effect low passing rates and rapid regulatory change had on mental health and suicides.
“If you remember when Julia Gillard changed the live cattle exports, there were a handful of suicides of cattle producers and all of a sudden there was uproar around the country and things changed,” he said.
Steinhardt said he knew eight advisers directly who died by suicide linked to quick moving legislation and the disruption it had caused to their lives.
“Some of the change has been good but a lot of it has been well intentioned but absolutely misguided and it’s absolutely hurt many people who have invested heavily in their businesses,” Steinhardt said.
Professor David Crompton, a leading researcher of suicide prevention from Griffith University, said: “It is difficult to determine why people choose to die by suicide and that there are many factors influencing that such as age, family situations, history of mental illness but the fact that people are raising this as a problem means it should be critically evaluated”.
Steinhardt said he knew a couple of “good advisers” with tertiary degrees from 35 years ago that were no longer relevant who were yet to pass the FASEA exam.
“They are very good financial advisers, but they haven’t done an exam like this in a formal setting in a long time,” he said.
“Both have failed a couple of times and so the anxiety that puts on them – they’ve kind of already failed before they start because of the stress and pressures now on them.
“If they don’t get this right they’ve got to walk away – their careers are finished well and truly before they are due to finish.”
For every one person forced out of the industry, Steinhardt said another half a dozen staff who would also no longer have a job.
“They’ve got families, responsibilities for their business and staff – if they fail it’s more than them that’s out of the industry,” he said.
While there were businesses such as his set up to support advisers through the exam process, there was not a great deal of support that could be provided as there was not the staff bandwidth to do so.
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