The Financial Adviser Standards and Ethics Authority (FASEA) has announced that it would commence its first public consultation on 12 November for its Code of Ethics (COE), following criticism from the Financial Planning Association and the Association of Financial Advisers.
In an announcement FASEA said it would consult with designated representatives of consumer, professional, education and other industry groups to provide opportunity for consultation on the practical elements of the code and to communicate and explain the integrated nature of the code.
It said on 22 October it invited consultation participation from industry professional stakeholders.
“To coincide with the release of the Guidance to the Code of Ethics, FASEA will hold a series of consultation briefing sessions with stakeholders to share FASEA’s Guidance on the COE (with particular emphasis on the integrated nature of the code), how it is expected to be operationalised and how to use the COE guidance as a tool to facilitate understanding of the practical application of the code,” it said.
“It is intended FASEA will present an overview to stakeholder participants and workshop a number of examples in the Guidance to assist stakeholders to have a consistent understanding of the operation of the Code and its impact on advisers.”
Earlier today, the FPA attacked FASEA for failing to adequately consult with financial planning professional bodies or their members for two and a half years while the AFA accused FASEA of going beyond its remit on the code on Tuesday.
Comments
Doesn't look a consultation to me. More like - we're going to explain it to you because you don't understand what you have to do, dummy!
I sold my finance practice (us1 Financial Group) licencesed with AMP in 2013 and yes I saw the signs many years prior to the Royal Commission Inquiry. I am no longer aligned with a financial institution or regulatory body, and as such, feel that my contributions to the first public consultation will be impartial, non-conflicted and insightful. Can you please let me know how to register as a participant and or get involved in research projects.
They're going to explain that public sentiment will drive the outcome, and only once that's bee determined at the time of any complaint will they be able to tell you how to interpret the standards, and therefore they will tell you which one you have failed at that time, so as to meet said public sentiment of the time....
Unbelievable.
With 2 months to go they now buckle to realise they have made grave errors in judgement and after 2 and a half years of requests.!!
The FASEA Board includes at least 2 practising advisers in Deborah Kent and Louise Lakomy.
Unfortunately, it also includes 2 Directors who have come from the Consumer Action Law Centre and CHOICE.
It's not hard to assume where the objection to industry wide consultation may have been driven from.
The last thing these latter directors would want is to allow the Code of Ethics to be reasonable and workable for the financial advice industry.
The Consumer Action Law Centre and CHOICE both regularly blasted anyone who advocated for the Life Insurance commissions negotiations during LIF and regularly objected to any form of insurance commission payment to advisers whatsoever. These organisations wanted all commissions banned entirely.
So, maybe there is a very obvious conflict of interest in relation to creating a reasonable and workable solution.
Perhaps the 2 practising adviser Directors are constantly overpowered and out voted in respect to approving consultation ?...............or perhaps they too have not been pushing that agenda ?
The fact is, the FPA and AFA dealt themselves out of relevance about the future of this profession when they pushed back at almost every reform pre and post Royal Commission. Face it, the old world is no more. If your business model is predicated on selling any product or service, then you're stuffed. Everyone talks about separating product from advice - well now its being enforced. FASEA COE is just the next step of that enforcement. There's a flood of people heading towards the S923a definition of independence and when there's enough of them in practice, consumers will simply migrate to independent advisers. Have you forgotten that next year, unless you are S923a compliant, you'll have to tell your clients you're "biased" ? Pity I can't buy shares in the PIFA - there's a growth business....
does the statement of bias come in on 1 Jan 2020?
Not set yet but I think I read the legislation will be in the parliament soon. It could be introduced this year given parliament rises for the year on December 5. Anyway, it seems that ASIC and APRA are accelerating their activities along with the rapid passage of the Grandfathering and related financial services legislation. Any thoughts this stuff will be sitting on the back-shelf are fanciful in my book. The problem here is that unlike the mortgage broker arguments, no one has mounted a public-interest argument why these reforms should be deferred. They all read like advisers are simply protecting their business model which was torched during the Royal Commission. On the other hand, these reforms look like they are protecting consumers and mum and dad investors. No one has put forward a credible argument against that proposition to sway the public sentiment off the path the government is on. In my view, the industry ballsed it up when it ignored the objectives of FOFA in 2013.
FASEA will also be consulting with "designated representatives of consumer groups". Which means FASEA will NOT be considering the negative impact of their draconian, undemocratic, laws on real consumers. So called "consumer groups" such as Choice and CALC no longer represent consumers. They have been taken over by ideological zealots and political wannabes. The poor old consumer has been abandoned in all of this.
As per Big Trev's comments above, the adviser associations need to be focusing on the negative consumer impact. No-one cares about the adviser impact, and no-one else is standing up for real consumers.
“the poor old consumer has been abandoned in all of this” - give me a good solid reason why?
‘They won’t get advice’ is the typical answer. But the public and government perception is that this ‘advice’ is simply about selling the consumer some other product. If you’re making statements about ‘consumer loss’, give a credible example.
Ah, so after they release their rules and guidance THEN they want to consult with the profession and others? Horse gate bolt shut much, idiots.
So why would they let the participants in an industry that has failed to be a profession comment on how to set standards of professional behaviour?
Haven't existing sales agents demonstrated beyond doubt that they are to date not a profession and completely lacking in ethics?
The fact you complain about the guidance demonstrates perhaps the lack of ethics in the industry, and that your associations also support this view proves how unfit they are to set professional standards and how inadequate they have been over the history.
Diego1956 you wrote "Haven't existing sales agents demonstrated beyond doubt that they are to date not a profession and completely lacking in ethics?"
At this stage no investigation has been conducted by ASIC at all into the conduct of the "sales agents" who I assume you mean those working at Industry Super - directly employed and paid by a fee from all members accounts. Perhaps an investigation should be undertaken?
Diego thanks for the comments. If you are referring to the planners that work for super funds fair enough. As long as they still exist I can see why you think that as they are employed as sales agents to retain fum. Just remember there are many of us with no ties to products , we operate freely and with professionalism at all times, there are more of us all the time, so please don't generalise too much.
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