The Australian Securities and Investments Commission (ASIC) has admitted it has no hard data on the extent of grandfathered commissions.
The full transcript of last week’s Senate Estimates has revealed that the regulator believes that the number of grandfathered commissions is reducing but that its own research amounts to nothing more nor less than a small sample of 20 licensees.
Answering questions from Queensland Labor Senator, Chris Ketter, ASIC’s senior executive leader in the Financial Advisers team admitted ASIC “don't have reliable estimates of the extent of grandfathered commissions”.
“We know that they're reducing. We know that a number of institutions have unilaterally announced that they're turning them off. We've done our own research on a small sample, which would indicate that the amount of grandfathered commissions is now quite small,” she said. “But the sample we had was 20 licensees across various sectors, so I can't give you an absolute per centage figure.”
However, Bird said that ASIC would be monitoring how product issuers were turning off grandfathered commissions and who would ultimately benefit.
“We'll be asked to monitor how a sample of them are turning those commissions off and what steps they're going through to ensure that the benefit is passed on to their customers,” she said.
When Ketter suggested that ASIC did not have any estimates about the amount of money tied up in “grandfathered conflicted remuneration”, Bird answered “no”