The Financial Planning Association (FPA) has accused the Financial Adviser Standards and Ethics Authority (FASEA) of having failed to adequately consult with the financial planning professional bodies or their members for two and a half years.
In strong statement issued today, FPA chief executive, Dante De Gori lamented the fact that the FASEA had issued a code of ethics guidelines without any attempt at consultation.
He said the FPA called on FASEA in February 2019 – and repeated this call on numerous occasions – to provide clear guidance that would help financial planners understand and comply with the Code of Ethics.
“Eight months later, FASEA has delivered a document that raises more questions than it answers,” De Gori’s statement said.
“With less than 50 business days before the Code is due to come into effect, FASEA has completely failed both in their obligation to consult and to provide clear guidance on how its standards will work in practice,” he said.
“The process has again been greatly disappointing and completely inadequate, which has produced guidance that is confusing, out of touch and at odds with existing financial planning laws and standards.
“After two and a half years, the FASEA board of directors has yet to consult with any financial planning professional bodies or their members and they appear to be more interested in academic theory than making a genuine effort to improve standards in the financial planning profession for the benefit of consumers.”
The statement said that, among other problems, FASEA’s Code clashed with the Government’s Royal Commission Road Map, released only two months ago, and the grandfathered commissions legislation passed by the Parliament just weeks ago.
“Financial planners and even the public are confused about which standards should be followed – those in the Code of Ethics set by FASEA or those in corporations law set by the Australian Parliament,” De Gori said.
The FPA now urgently calls on the Government to step in, and to recognise that FASEA has again failed to deliver its mandate to consult and deliver, this time with the Code of Ethics and accompanying guidance.
FASEA’s website still claimed that it would release a draft of the guidance document for public consultation before it was finalised, demonstrating the scope of its failure to consult.