FASEA approves ASIC guidance on COVID-19 relief ROAs

The Australian Securities and Investments Commission (ASIC) has released guidance for advisers when giving records of advice (ROAs) provided under the temporary COVID-19 relief measure, which it consulted on with the Financial Adviser Standards and Ethics Authority (FASEA).

Under the relief measure, advisers could provide an ROA instead of a statement of advice (SOA) to existing clients that required financial advice due to the impact of the pandemic, which was extended in April.

“We welcome FASEA’s confirmation that the ROA example is consistent with advisers’ obligations under the Code of Ethics,” ASIC said.

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“The example ROA is just an example and confined to the particular facts in the scenario and the requirements under the Corporations Act 2001.

“Australian financial services (AFS) licensees and their authorised representatives should consider their clients’ relevant circumstances when preparing and tailoring their ROA appropriately for clients, as well as any other legal obligations.

“All references to sections or regulations in the annotations to the example ROA are references to sections in the Corporations Act or regulations in the Corporations Regulations 2001 as inserted by the COVID-19 instrument.

“References to paragraphs in ‘RG 175 are references to Regulatory Guide 175 Licensing: Financial product advisers—Conduct and disclosure’ (RG 175).”

The guidance for ROAs included:

  • The providing entity or an associated providing entity must have previously given the client an SOA that sets out the client’s relevant personal circumstances in relation to the previous advice;
  • The providing entity must reasonably consider that the advice is required because of the adverse economic effects of COVID-19;
  • AFS licensees and authorised representatives must keep records of the personal advice given to clients;
  • The ROA must set out a brief explanation of changes in the client’s relevant personal circumstances in relation to the COVID-19 advice;
  • The ROA must include brief particulars of the recommendations and the basis of the recommendations;
  • The COVID-19 advice must be in relation to a class of financial products to which the previous advice related;
  • A reasonable investigation conducted under s961B(2)(e) does not require an investigation into every product available;
  • The ROA must set out brief particulars of the information or the statement that would be required by s947D(2) and 947D(3) if an SOA were given to the client;
  • When giving the COVID-19 advice, the providing entity must disclose any actual or potential conflicts of interest, commissions and remuneration that might influence the providing entity in giving the advice and, if applicable, any replacement financial product disclosures; and
  • A copy of the ROA must be given to the client at the applicable time.



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Opps - "When giving the COVID-19 advice, the providing entity must disclose any actual or potential conflicts of interest, " - FASEA breach right there. And so we highlight the ridiculous round about between the law and the code. FASEA says you must AVOID and ASIC/the law says you can DISCLOSE. This all said, not sure of the point of this legislation as I'm not sure how this is any different to the normal situation in which you would give a RoA. Must have done a SoA, must be in relation to a class of financial products to which the previous advice related etc etc...... Gee we have a lot of people around wasting a lot of time on stuff that makes no difference but makes them look busy.

Hi Anonymous.

You said that you were not sure how this is different to the normal situation in which you would give a ROA. There is one important difference. Under "normal" situations you could not legally give an ROA where the client's circumstances are "significantly different" to when the "previous advice" was provided - see Corps Reg 7.7.10AE(2)(b)).

The COVID Relief ROA provides for the ability to give an ROA (instead of having to provide a full SOA) where there are significant differences subject to the condition that the COVID Relief ROA sets out a brief explanation of changes in the client’s relevant personal circumstances in relation to the COVID-19 advice.

I think that is the key difference.

Also, under the "normal" rules the ROA does not have to be given to the client, but merely retained by the adviser. The client may ask for a copy of the ROA at any time up to 7 years after the advice is provided. Under the COVID Relief ROA measures, the ROA must be actually given to the client at the time of providing the advice.

All well and fine. If you don't give a client a RoA then although this might be legal, I don't agree it is right. We only ever give a client the RoA and get them to sign to agree to the changes or even if things are staying the same. Maybe less time with all of this bullshit and more time making the industry more client centric would be useful.

Why do you spend all your days making comments which are generally wrong. When you know the Law then you can criticise.

If you don't like financial planning - get out of it.

Irene was right the other day.

Well guys, that's amazing in the 3 months left in this relief period. I'm really glad we waited to get it right. Remind me again when this relief was originally granted?

I feel like Indiana Jones trying to get that golden statue. FASEA and ASIC have set up so may booby traps in their efforts to stop me reaching my goal of helping clients and when I do finally get there and provide advice despite their best efforts, I risk being squashed by a big concrete ball that goes by the name of AFCA that I have to run from for many many years to come..

Classic Canberra bubble bureaucratic bumbling morons shuffling useless BS Regs amongst their little selves.
I wonder if they think they are actually doing anything real ?
Or more likely they just laugh at causing such Adviser destruction over many years and giggle at new ways to provide useless relief.

Yes they think they are doing something positive, and yes they are laughing at us. ASIC have a rotten culture, filled with hate and jealously. They will stop at nothing in their effort to destroy financial advice careers and businesses. Any relief will be fake, designed to fool politicians and divert attention away from the consumer harm inflicted by their meddling over the last two decades.

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