FPA moves on soft dollar
TheFinancial Planning Association(FPA) has embarked on a disclosure campaign with a specific focus on soft dollar as part of its effort to improve professional standards.
The move involves the FPA forming a working party with theInvestment and Financial Services Association(IFSA) to develop a widespread industry position on soft dollar benefits.
FPA acting chief executive June Smith says the campaign aimed to develop standards for dealing with conflicts of interest in payment structures and create a standard for fee disclosure.
Smith says the FPA’s overall position was to discourage the use of soft dollar incentives, but also stated there had to be recognition of payments that created conflicts of interest and those based on performance not aligned to products or product providers.
In a related move the FPA has appointed Professor Ian Ramsay to research the disclosure of fees and charges.
Ramsay has been asked to look at the issues of whether payment structures should align the interests of the consumers with the adviser as well as how the market should determine payments.
He will also cover the standardisation of disclosure documents, investigating the issue of soft dollar to create a consistent industry view and looking at relationships between products and platform providers.
Ramsay will report back to the FPA in December with member feedback to follow in January and February of next year with an industry roundtable to discuss the outcomes in March.
The actions are part of the FPA’s Professional Partner program which is made up of five separate campaigns.
AUTHOR
Jason Spits
Recommended for you
WT Financial has announced its second “Hubco” with a combined valuation of $7.8 million, while its first one has successfully incorporated and is now making its own acquisitions.
Remediation and litigation costs have led AMP to announce a reduced statutory net profit after tax of $98 million for the first half of 2025.
Stakeholders in the professional year discussion underscore the challenges in the current pipeline and what is holding back licensees from taking on new candidates.
Colonial First State has partnered with JP Morgan Asset Management to make its inaugural private equity allocation, continuing the firm’s expansion into unlisted asset classes.
