The Stockbrokers and Financial Advisers Association (SAFAA) has criticised the latest regulatory levy and warned advice will remain unaffordable if costs are kept high.
Last week, it was reported the Australian Securities and Investments Commission (ASIC) annual levy for 2020/21 would be an extra $712 from the previous year.
But, according to data from the Australian Financial Complaints Authority, stockbrokers received 0.6% of all complaints between 1 October, 2019, and 30 September, 2020.
Judith Fox, chief executive of SAFAA, said it appeared smaller entities were having to fund action against larger institutions, particularly as no stockbroking firms were called up during the Royal Commission into Misconduct in the Banking, Superannuation and Financial Services.
“This increase comes on top of an increase of 160% in the two years to 2019/20 and is coupled with a sustained reduction in the number of financial advisers across which this cost can be recovered,” Fox said.
“The recent increases to the ASIC levy are not sustainable and are being unfairly attributed to the current population of financial advisers.
“Advice to Australians cannot be made more affordable if the costs of providing that advice increase unchecked.”
Fox added the organisation was also concerned further funds would be needed by ASIC to administer the disciplinary regime and that cost would be pushed onto members.
“We are concerned that the costs of the new disciplinary body that are incurred by ASIC will be passed on to our members and push up the final levy,” Fox said.
“ASIC’s cost estimates have routinely been between 25%-55% less than the final levy amount, making it extremely difficult for businesses to plan for this expense.”