Advisers denied stockbroking exemption
Financial planners who provide direct equity advice have failed in their bid to gain an exemption from having to provide a Statement of Advice (SOA) in time-critical situations, prompting fears that they have been left at a significant disadvantage to their stockbroking rivals.
The Australian Securities and Investments Commission (ASIC) has knocked back a Financial Planning Association (FPA) submission seeking class order relief for planners to put them on par with stockbrokers.
Stockbrokers are regulated by the Australian Stock Exchange under different legislation and have a conditional exemption from the need to provide an SOA for Further Market Related (Share) Advice in time-critical situations.
FPA policy manager Joan Simpson says the aim of the association’s submission was to put financial planners on a level playing field with stockbrokers.
Simpson says the SOA requirements can be a disincentive to not only planners, but clients.
“It slows the process down, and it means a client doesn’t feel able to call on their financial planner and ask about share related issues,” she says.
“It also means planners are less likely to give the sort of advice they’d like to give their clients,” Simpson says.
Despite the knock-back, a spokesperson for ASIC says it is considering other ways of offering financial planners who advise on direct equity relief from the SOA requirements.
Simpson says ASIC has indicated it will provide further feedback to financial planners in the next month.
“They are going out of their way to be as flexible as possible,” Simpson says.
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