Have industry leaders abandoned Dover advisers?

Everyone seems to have forgotten that Dover’s former advisers are small business owners who have staff, families and financial commitments to meet, according to specialist financial planning business broker, Paul Tynan.

In an analysis of the situation in which former Dover advisers now find themselves, Tynan pointed out that in most instance their advisory practices represented a lifetime of effort with the ultimate exit and succession objective being sale of the business to fund their retirement aspirations. 

“Through no fault of their own, Dover’s former advisers find themselves currently not receiving any income with financial obligations to meet, whilst juggling the dual challenges of finding a new AFSL and then having to negotiate with product providers to release their revenue entitlements,” he said.

Related News:

Tynan pointed to the depth of the invidious situation former Dover advisers found themselves in when he said some manufacturers had affirmed they had no intention of passing on any revenue at this time, the Australian Securities and Investments Commission (ASIC) had cautioned licensees to do full due-diligence on Dover advisers and businesses, while some institutional planning groups had signalled their intention of steering clear of ex-Dover businesses.

“What did Dover advisers do wrong that warrants this appalling retribution when they are forced to work within a licensing framework that is biased against both the adviser and their clients,” he said. “The current scenario is the perfect nightmare for our advice industry.”

Tynan said Dover was not a one-off event and that this year he had counselled a number of advisers who had lost their businesses due to the actions of their licensees.

“On one occasion, an adviser had self-reported to his licensee about an internal process issue, who in turn revoked his license resulting in the loss of his business and a million dollars of recurring income,” he said.

“If consumer confidence is to be restored, the entire advice community together with ASIC must work together to support and transition the 400 ex-Dover advisers to new AFSLs,” Tynan said

“The silence from our captains of industry has been deafening and highlights the silo mentality that exists within the sector,” he said.  “But the most damning outcome of this fortress mentality by the industry’s institutions, key stakeholders and regulatory bodies is that their response has been to a focus on self- interest which is not aligned or reflects the best interest needs of the consumer.”


Recommended for you




One would trust that the AFA & FPA are doing everything that they can to support their Practitioner members through the process of becoming re-authorised. You cannot take membership fees without delivering value.

Get real. The FPA receives members fees from the large Banks. They are solely their for the large banks. The FPA silence on the Dover issue and how they've represented members in this issue is frankly disgusting.

Don't hold your breath for ASIC to do anything to help financial planners. Time and time again they have made it clear they hate all financial planners. They only time they have shown support is to the failed CPA advice arm and to the union funds through their refusal to investigate the constant breaches of the sole purpose test and general advice regulations.

I think what is being missed here is that something was going on in the background.
From what's been disclosed ASIC was working with Dover's principals about something that is within ASIC's purview -- at a guess it was a compliance matter of some sort. At some point in the process it appears that Dover's principals have decided "it's all too hard, we'll just surrender our licence."
The issue for me is -- do Dover's financial planners have a right of action against Dover's principals? I have not seen this addressed, but would think they would have a right of action.

I can't understand why so many Advisers flocked to Dover in the first place. They only grew to 400 Adviser because they were prepared to take on anyone regardless of their track record. Why would you want to be part of a licensee like that? I feel sorry for decent advice businesses within that group but I think you'll find that a reasonable percentage of Dover Advisers were on their last chance anyway.

That is simply not true. Many good planners joined Dover as a way to give advice not influenced by product. They also liked the flat fee structure and the fact they could allow a determined single planner to see if they could build a business away from AMP et al. I don't think many were on their last chance with their old dealer group. There are a lot of well respected planners at Dover. The training days were always full of planners from other groups wanting to join but couldn't because they were trapped at their old dealer group.

James they didn't decide to wind the business up just because of what came out in the RC, that was just the trigger for ASIC to say to them, "now we're going to look closely at every adviser on the books and the process involved in bringing on every adviser". It's pretty clear that Dover realised that at the end of that process the result would be more than just an EU, their license would be revoked anyway. For Dover not to be able to negotiate at least a 30 day transition period just shows that they never cared about any of the advisers, it was just about growing the numbers to generate revenue for themselves.

Add new comment