The Australian Securities and Investments Commission (ASIC) has sent a message to superannuation fund trustees to properly discern the difference between general and personal advice, pointing to the recent Full Court decision impacting BT Funds Management.
ASIC commissioner, Danielle Press has used an address to the Conference of Major Superannuation Funds (CMSF) in Adelaide today to confirm that the regulator was currently examining a number of funds to ensure that they were adhering to the interpretation handed down by the full Federal Court.
Press said that ASIC recognised that the provision of financial advice represented a current challenge for superannuation funds but the regulator took the view that helping the member needed to be paramount.
However, she also signalled the degree to which the Federal Government had taken control of the advice issue, noting that a lot of the change which would occur would be legislative change, not regulatory change.
In doing so, Press urged superannuation funds to “lean into” the consultation processes around the Government’s review of financial advice.
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No doubt the ISF's will be subjected to a quick flick through over an ASIC trainee's morning coffee before the real stuff starts with the retail funds and their cash cow parent company's ASIC most enjoys feeding from.
In the judgment, Justice Gordon reinforced that s766B(3) of the Corporations Act, which outlines the meaning of general and personal advice, ‘is directed to the protection of the retail client’ and clarified that ‘[…] the general advice warning must be assessed in light of all the circumstances. The general advice warning was given only once, at the beginning of the telephone conversation. Members were subsequently asked directly about their personal objectives. Members were not encouraged to seek personal advice before deciding whether to accept the rollover service.’
So the question for ASIC is, Westpac-BT gained an additional $650 million of FUM by breaching personal advice, so is ASIC going to levy a fine of $65 million on Westpac-BT or will small independent Financial Advisers pay for this institutional misconduct in their 2020-21 ASIC Industry Levy?
ross is this a rhetorical question?
the solution to every problem is to ban a financial planner
and our PI Insurance premiums from London, doubles again
If they do ASIC with Westpac will direct it to Choice again just in for Choice to fund a campaign later in the year against Mortgage Broker trail commission. Just like the $40million fine Westpac and CBA paid to Choice before the RC.
If anyone was ever in any doubt, Daniel Press is now brave enough to confirmed that ASIC completely supports the delivery of advice from product providers.
".......ASIC recognised that the provision of financial advice represented a current challenge for superannuation funds but the regulator took the view that helping the member needed to be paramount."
All that conflicted stuff about conflicts, commissions, and bad consumer outcomes, FFNS etc - now that ISA competition Financial Planner numbers are reducing, Banks out and AMP on it's knees, - all forgotten and affordable advice can be delivered by ISA - but not the competition.
They'll check 20 files from 15 funds, come up with a 50% pass rate and say that's ok, some improvement needed, we'll review again in 3 years.
I must have missed the press release clearly Danielle Press, after missing the top job at ASIC, has taken up a position with industry funds.
ASIC are clearly green lighting Industry Super to ever increasing Hidden Commissions, vertically owned call centre jockeys to provide Advice. Zero AFSL compliance, no BID, no FASSEA code or education.
They know Industry Super can’t do Real Advice so they will make what ever rules ISA want and let its sales happen.
At same time continue killing real advisers with ever increasing BS Regs and Costs.
REGULATORY CAPTURE CORRUPTION AG IT WORST ASIC AND INDUSTRY SUPER.
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