ASIC’s non-action on general advice disappointing: FPA

The Australian Securities and Investments Commission (ASIC's) decision not to act to relabel 'general advice" has been strongly criticised by the Financial Planning Association (FPA).

ASIC has used consumer research to argue that no change is needed to the general advice position, something which has angered the FPA.

ASIC said: “The research found no evidence to suggest that changing the general advice label, including adding the word ‘only’ to the general advice label, will have any measurable effect on consumers’ perceptions about the nature of the advice given.

Related News:

“This includes perceptions about the personalisation of the advice, understanding of the advice provider’s obligations and the importance of seeking further information.”

Responding to the research, the FPA said while renaming general advice was not a silver bullet, it was the first step to making lasting change.

FPA chief executive, Dante De Gori, said there were multiple Government reports that found consumers were confused about the difference between personal and general advice.

“This is seen in the High Court decision to dismiss Westpac's appeal against the Full Federal Court's finding that two Westpac subsidiaries provided 'personal advice' when they claimed to be providing ‘general advice’,” he said.

“We stand by the recommendation in the FPA Policy Platform – Affordable Advice, Sustainable Profession – that the term ‘general advice’ be changed to ‘product information’ and ‘strategy information’, which better reflects the definition and is less misleading to consumers.

“Any replacement must ensure that the term ‘advice’ can only be used in association with ‘personal advice’ — that is, advice that takes into consideration personal circumstances.”

He said ‘general advice’ was a term that continued to be misunderstood, misused, and was misleading to consumers.

“The Quality of Advice review won’t be completed until at least 2022 and ASIC’s decision to ignore the problem with ‘general advice’ until then condemns consumers to another year of confusion and the risk of harm,” he said.

Recommended for you




ASIC have no valid connection to true customer sentiment...we've seen time and again that people find the term "general advice" to mean more than intended under the law. Thus they expect they are having someone consider something about them when discussing or getting general advice. ASIC's view here is just totally left of centre and lacking any strong basis in fact or reality...just when it was time they remove the foot from their mouth they shove the other one in!!

A nice way to make it easier for one of the FPA's largest financial contributors (AwareSuper) to provide Advice and avoid the regulatory loop holes that the rest of us advisers claiming "General advice is not really advice, it's something else".. Time the FPA get's off the payroll of these large insto's and start calling a spade a spade....This is just a blatant attempt at making it easier for call centre advice whilst regulating advisers out of work.

who funded this research? How many surveyed?

I could guess it was a panel of choice and griffth uni people and they paid them some astronomical amount, lets say $30,000 each for it. May be wrong but nothing and I mean nothing would suprise me.

Of course ASIC won't change the fraud that is General Advice as it is the biggest scam of ALL Industry Super Advice / Sales.
Industry Super Call Centre jockeys with zero Advice education, experience, zero AFSL compliance, zero BID, no FARSEA.
ASIC's REGULATORY CAPTURE CORRUPTION at it's worst for their best buddies Industry Super.
Disgusting ASIC, drain the swamp and start again.

I cannot see how what has been reported as the FPA position in the above article is in any way practical. To fall within the definition of "general advice" the conduct must be a recommendation or statement of opinion that is intended to influence a client in relation to making a decision about a financial product (where the adviser does not take into consideration the client's financial situation, needs or objectives). This is clearly more than just "product information". Product information would logically be interpreted as merely factual information about the product. "General advice" as defined under the Corps. Act involves an attempt to influence the client. To merely call that type of conduct "product information" would be the thing that would most likely mislead clients.

What a "stitch up" Really ? How can they not see the word ADVICE causes people to think that that is what is being provided? More than information ! Information is something you read about then you call the Company or person involved for ADVICE on the INFORMATION. They have made a simple process into a proposition from Einstein. Leaving the everyday person to be solve the equation on their own using their own individual understandings. { we now have hundreds of possibilities on what the answer should be instead of the one that serves their best interest.
As mentioned it sticks out like the "proverbial " this has been disregarded and applied to online call centre's to can get away with the no advice no penalty of their actions calls they claim is not giving advice !! Please how dumb to they think we are?

Of course ASIC don’t want to make it easier for consumers or financial advisers. Clarity would lead to less complaints & lesser incidents for ASIC to ping the industry on. They’d have less work to do & therefore the “money tree” that is the ASIC Supervisory Levy won’t be producing as much fruit”. No conflict here of course…

That's because ASIC doesn't understand the issue!

If you start with the premise that everything ASIC do is pro left wing union funds and damaging to financial planners, everything they do makes sense. Their latest stitch up is to disallow advisers to meet with their clients early and sign off the new annual fee consent. You can't even do it one day early. If you meet with a client after 364 days, bad luck, book another meeting or post it out. It makes zero sense, unless you view it through the lens described above.

Well said George. Also make sense why ASIC is after Westpac for Insider Trading - it cost Industry Super some money so ASIC/Industry Super will be mad as hell.

ASIC is corrupt and broken. It doesn't need changing or mending, it needs to be entirely replaced (I mean look at its f*cking unusable 1980's website, that is a great indication of an organisation in utter complacent ineptitude). F*ckers.

the word 'advice' and 'General' should not be permitted together. There is no advice in anything general

What type of medical advice does general practioner provide ?
How is that different from specialist, or surgeon even ?
Should there be distinction in medical advice given by gp and specialist?
If there is does it make medical advice given by gp less valuable ?
What safeguard should gp apply while giving medical advice to a yet to be diagnosed individual.?
What would be an equivalent of that in Financial Advice world ?
I am borrowing some of the vocabulary from some of the existing posters.
Should "Industry Super Advice / Sales, Industry Super Call Centre jockeys with zero Advice education, experience, zero AFSL compliance" get some education, and abide by AFSL compliance before providing general advice?
How do you know, they already don't do that ?

Why I resigned from the FPA. They are simply a front for the intra-fund marketing rep industry funds (who conveniently sidestep the Hayne2 red tape) and churn out next to useless seminars in order to lock in their members . What a scam.

Add new comment