Are advisers facing an eighth layer of regulation and cost?

The Australian Competition and Consumer Commission (ACCC) has been warned against imposing more cost and regulation on financial advisers via the implementation of Consumer Data Rights (CDR) rules.

The warning has come from the Financial Planning Association (FPA) which has expressed concern that together with needing to be registered with the Australian Securities and Investments Commission (ASIC) and the Tax Practitioners Board (TPB) advisers would need to be registered with the ACCC.

It said that financial advisers were already the subject of a “plethora of regulators” with financial advice being regulated and monitored by seven regulators.

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“…the FPA is concerned about the administration and cost of maintaining their registration with the ACCC. Many of these regulators operate under or will shortly transition to compulsory fees, cost and levies,” the FPA said. “This surmounting regulatory cost increases the cost to provide advice, which hinders the Australian consumer’s ability to afford financial advice when they require it.”

The FPA has asked the ACCC to clarify what costs for advisers would be associated with the CDR regime, noting that any additional cost associated with registration would “exacerbate the cost of financial advice, noting we also expect software licensing fees to increase to cover the costs associated with providers”.

It noted that there were already Government registers of financial planners held with ASIC and the TPB with these registers also used by the general public to verify the status of their financial planner, accompanied with education resources to help consumers navigate financial providers.

“The FPA would, therefore, recommend that rather than creating a third register, there is an opportunity to use these existing registers. This provides an opportunity to reduce duplicate administration activity and costs, as well as assisting with future verification of ‘principals’ as these will be mapped to ‘CAP providers’. Alternatively, the ASIC or TPB registers could be used to auto-register financial planners and given the requirement that these are kept up to date can be considered as the source of truth for the ACCC register of principals.”

The submission said that an additional consideration for the ACCC was that in terms of consent, financial planners often acted as the representative of the consumer which product providers and were required to maintain third party authority to represent their clients and access their financial information, as well as consent for collection of advice service fees.

“These are to be mandated on an annual basis depending on the development of recommendations of the financial services royal commission. Thus, FPA recommends that rather than creating a new process or standard, consumers are able to authorise their financial planner as a ‘principal’ as part of this existing process. This will assist in minimising cost and regulatory duplication,” it said.




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Why doesn't the ACCC get onto say third line enforcement on wraps via restricted investment menus or pricing tailored to that effect, or why doesn't it do anything about pay for research fund approval or shelf space, or fund manager rebates not passed back to consumers. No, wait, we'll just chip some $$ from 20,000 advisers and all's sweet.

Well said the ACCC doesn’t have the stones to go after the big end of town like they should be so they think us advisers are easy pickings, makes me so sick like you said to after the big institutions and their restrictive APLs or AMP for charging $20k to fund managers so they can be on their APL, these are the clear issues in the industry.
Hardly any consumers know about ASICS financial adviser register they are kidding themselves that another register they run will improve consumers data or choice they are just trying to revenue raise.

Email the politicians who are running the standing house on economics committee some of them have replied to my concerns previously see below link

https://www.aph.gov.au/Parliamentary_Business/Committees/House/Economics...

Why don't the FPA provide a fee disclosure statement to members so they can justify their own fees? How is my $1195 being spent? What's good for the goose...

If anyone out there is paying FPA or AFA fees of $1195 i would suggest you cancel your membership and go on a nice weeks holiday and spend the money on something worthwhile.

well said

Great in theory but very few Advisers meet the education requirements set by the TPB to gain registration, leaving them with the other pathway of being a member of an industry association. Ridiculous really.

Yep more BS REGS and registers from freaking Govt bureaucrats from their Canberra bubble.
7 Regulators is not enough duplication.
Let’s go for 8 hey ACCC
Next year 9 with the new FARSEA body.
Then 10, let’s duplicate things 10 times.
BEYOND MORONIC GOVERNMENTS !!!!
FOR F##K sake it’s so sad.

the only 8th, I want more, more regulation. I want to sit and file papers and produce nothing all day.

can the government please subsidize my business.

last time the FPA had Jane Hume on a webinar she thought the over-regulation was funny. that's our minister who thinks it's funny. she is very fit and proper for her role.

free money (and coffee) for everyone YAY.

phuoc

This comes on top of the proposed increase in the ASIC Supervisory Levy for FY19/20, now $1571, or to put it another way, a 65% increase in compulsory fees over 2yrs. The number of advisers on the FAR has decreased by 5,000 and the remediation programs etc are well past their peak, so ASIC should have less work and supervision to do. How else can they justify a 65% increase in fees? If it was a monopoly company, the ACCC would be all over them. Oh, but it's just another government body sucking on the teat of private enterprise.

Jane Hume assistant minister for financial services laughed knowing there are nine parties that could audit financial planners.

she thought it was funny.

that's the government's response.

so funny, everyone holds financial planners in contempt. they think we are a bunch of pushovers that can be pushed to do anything.

they might even propose i dress like a pirate with a monkey on my left shoulder

and we are a bunch of stupids who will just comply with the idiots who make up these totally retarded rules

we really are a bunch of stupids who can't stand up for ourselves

and yet you renewed FPA membership fees. I think stupidity sums up financial planners well.

everyone laughs at us even the meagerly qualified accountants with only a diploma of accounting who were grandfathered because they are super old

we are a joke

Speak for yourself phouc, my clients dont laugh at me, my referral group that includes an accountant dosent laugh at me. Take a chill pill, you are starting to believe what you read and what our jealous detractors say. Only believe what your clients say, the rest dont matter.

my clients love me, they think I am Jesus and can walk on water.

it's the rest of the industry and the regulators that are assholes and I am sick to death of being belted by everyone that's all

I am already fasea qualified exam passed fp masters degree holder and an accountant with a second masters

I need something stronger than a chill pill

Yes your clients love you....but what about the rest of Australians that are missing out on the great advice advisers like you provide. They miss out. One day you won't be able to find staff or a paraplanner, or you won't be able sell your business to a young graduate and you'll wonder why.

The environment regarding the mountainous legislation and compliance impact is killing financial advice and killing the people in it either mentally, medically and physically.
The toll it is taking is serious and relentless.
Its killing season and there appears to be no consideration at the human level whatsoever.

Spot on. You'll recall, during the CBA advice scandal the FPA said, Yes we agree with CBA, it's not CBA.., it's advisers lack of education. You got FASEA and the FPA got compulsory membership from CBA. There's a reason why there's so much regulatory red tape and it's the FPA. If you're a member of the FPA, a body called "incapable of being a code monitoring body" at a Royal Commission ...a body that accepts a $60,000 cheque + from AMP et al and a list of members names, are you not complicit and contributing to that problem you've raised? A body that has over $10 million just sitting in cash on it's balance sheet, that's never ever been used to defend financial planners. I hope that CFP brand is worth selling out your comrades.

Planners cannot be continually bombarded with levies and taxes and multiple membership. The issue is the FPA is in bed with large insto's. ASIC knows it, Treasury knows it, Labor Party knows it. When you're in bed like the FPA is with firms appearing at a Royal Commission your Advocacy efforts are going to be wasted. Paying FPA membership fees is probably the biggest waste. Levies to ASIC, TPB, AML registration, AFCA membership, given how the FPA have been in the pockets of AMP for 20 years my recommendation is join the cheapest body for TPB status, and save yourself $1,095 a year. Or alternatively go out and get the study.

everytime the fpa and afa call on governments or the regulator to ease the burden. they pile on more forms for us to fill.

is it just me or is anyone else noticing that?

jane hume was interviewed by Dante, his disgust afterwards (and fair enough to Dante is growing balls and I am liking him a lot more now) were palpable and manifested themselves at the end of the call for those of us who had the pleasure of listening in.

let's rip into 'em whats the $10m in cash for this is the rainy day. let's spend it.

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