Govt regulates directing grandfathered commissions to clients
The Federal Government has released the regulations which will underpin ensuring that any benefits of banning grandfathered commissions flow to consumers rather than product manufacturers.
The Treasurer, Josh Frydenberg announced that the regulations would impose obligations on product manufactures to keep records on the amounts to be passed through to clients.
The explanatory statement attaching to the changes states: “Where the conflicted remuneration can be attributed to a particular client (for example, if the financial adviser received a commission for selling a financial product to that client), the covered person must provide a cash rebate to the affected retail client on a dollar-for-dollar basis”.
“Where the conflicted remuneration can only be attributed to a client group, the covered person must divide that conflicted remuneration between the affected retail clients in a just and equitable way,” it said. “The covered person may provide a cash rebate, or they may provide a monetary benefit (for example, a reduction in fees). The amount of the cash rebate or monetary benefit must be an amount that is just and equitable in the circumstances.”
Recommended for you
ASIC has released the results of the latest financial adviser exam, held in November 2025.
Winners have been announced for this year's ifa Excellence Awards, hosted by Money Management's sister brand ifa.
Adviser exits have reported their biggest loss since June this week, according to Padua Wealth Data, kicking off what is set to be a difficult December for the industry.
Financial advisers often find themselves taking on the dual role of adviser and business owner but a managing director has suggested this leads only to subpar outcomes.
