Advice sector should not fund CSLR: Synchron
The financial advice industry should not have to pay toward funding the upcoming compensation scheme of last resort (CSLR), Synchron believes.
Synchron director, Don Trapnell, said 1.4% of complaints to the Australian Financial Complaints Authority (AFCA) were related to advice, and 0.03% were not settled, but the advice sector was expected to fund the lion’s share of the CSLR.
“On these numbers, it's clear that financial institutions that operate managed investment schemes should pick up the tab," Trapnell said.
"The advice community should not be required to pay any CSLR levy whatsoever."
Trapnell noted the CSLR proposal paper required the advice sector to pay 76% of the estimated levies for the scheme.
"On the flip side, the managed investment scheme providers, which have wreaked absolute havoc on consumers, will not be required to pay anything at all. It's absolutely disgraceful,” he said.
"The Government must stop making scapegoats out of the advice community, which is clearly not responsible for product failures and not responsible for the vast majority of AFCA complaints.
"A CSLR levy should instead be imposed on all new products and investment schemes."
Recommended for you
Sharing his reasoning in joining the FSC board, WT Financial chief executive, Keith Cullen, believes “product and advice cannot be separated” from each other in the current environment.
The Emerge Foundation, a charity run by financial advisers and fund managers, has announced a scholarship program to help veterans transition into tertiary education.
In an open letter, Sequoia chief executive Garry Crole has hit out against shareholders “with a personal axe to grind” as he fights for his job ahead of an EGM.
The JAWG has announced it is in talks with Treasury around five “core principles” to strengthen the education standards for new entrants to the financial advice space.