Six of Australia’s most significant financial planning licensees, five of whom have professional partner status with the Financial Planning Association (FPA), have rebuffed key elements of the FPA’s policy proposals which would see adviser registration over-ride licensee control arguing they were never consulted.
A joint statement approved by the chief executives of Centrepoint, Fortnum, CountPlus, Paragem, Easton and Fitzpatricks has declared that: “The FPA policy is a surprise and ill-considered given the hard work that the entire advice sector has put in to overcome historic shortfalls brought to light by the Hayne Royal Commission and in light of the leading work that AFSLs bring in areas of education, risk mitigation, compliance, consumer best interest measures and commercial support to advisers and their clients”.
It went on to state that “the key areas of Cost and Consumer Protection must be understood, thoroughly, and not diminished through poor policy”.
The statement conceded that the FPA’s proposals for an investigation of reform of the Corporations Law as it relates to its focus on product, not advice, had merit.
However, it added that any consideration of this by Government must also look at the true costs and consumer protections currently afforded under existing AFSL Licensing obligations.
What is more, the licensee chief executives pointed out that financial advisers already had the ability to self-license albeit that “ an individual planner that does self-license will incur the set costs of compliance, governance, and a raft of statutory obligations in providing that advice. These costs are not discretionary. They are mandatory and - in the absence of scale - would likely rise to the detriment of the consumer”
“The AFSL system plays a significant role in the oversight of financial advice (that is not limited to product). Licensees have played and continue to play a crucial role in developing, training, educating, and supervising licensed financial advisers,” the statement said.
The statement was attributed to Neil Younger, Group chief executive, Fortnum Private Wealth, Angus Benbow, chief executive, Centrepoint Alliance, Grahame Evans, chief executive, Easton Wealth, Matthew Rowe, chief executive, CountPlus, Matt Fogarty, chief executive Fitzpatricks Private Wealth and Nathan Jacobsen, managing director, Paragem.