Call for safeguards
Newly elected national president of the Securities Institute Michael Willis has lent his voice to the argument calling for real estate agents to be subject to the same regulatory regime as other financial services providers.
Newly elected national president of the Securities Institute Michael Willis has lent his voice to the argument calling for real estate agents to be subject to the same regulatory regime as other financial services providers.
“The public is entitled to expect the same range of safeguards whether they are dealing with a real estate agent regarding an investment property or receiving investment advice from a licensed securities adviser,” says Willis.
The Institute’s view is supported by the Australian Securities and Investments Commission’s (ASIC) review of the financial advising activities of real estate agents which found a strong functional similarity between financial advice about real estate and securities and similar consumer risks.
In a recent submission to Treasury on the Financial Services Reform Bill (FSRB) the Institute calls for a level playing field.
“In view of the very significant financial burden that retail investors in real estate take on because of the higher level of borrowing, and the corresponding increased risk, we believe the draft FSRB should be amended to make real estate agents who give personal recommendations as to the suitability of particular real estate investments subject to the same authorisation requirements, disclosure requirements, conduct standards and investor redress mechanisms as other financial services providers.”
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