Disclosure refinement needs cooperation
Steve Tucker
The chief executive of a leading financial services organisation has called on industry participants and regulators alike to work together to find a pragmatic solution to the impractical disclosure requirements burdening the industry at the moment.
Speaking at an American Chamber of Commerce presentation, MLC chief executive Steve Tucker said: “The bottom line is that the complexity of disclosure documents is very unhelpful to consumers.
“Industry will say that the current lengthy documents are driven by the need to comply with regulations. Regulators will say it was never the intention of the regulation to bury customers in paper,” he added.
According to Tucker, good regulation should first and foremost protect consumers by incorporating meaningful disclosure, act as an educational vehicle and have the ability to empower individuals to take more responsibility and control of their financial futures.
In regard to the Financial Services Reform Act, Tucker feels the implementation of the regulation has caused it move away from these tenets. He believes while sound in principle, the model based on disclosure has not had the desired practical effect and has led to the well-publicised consensus that disclosure statements are too long and too difficult for consumers to both read and comprehend.
“It is time for, and I am pleased to say this is happening, regulators and industry to work closely together to breakthrough on this disclosure issue once and for all,” Tucker concluded.
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