Regulator bar being lifted on planners
The Australian Securities and Investments Commission (ASIC) has sent a clear message to financial advisers that it will be raising the bar on the provision of financial advice not backed by sound research.
The message was conveyed in a speech delivered by ASIC’s deputy chair, Jeremy Cooper who said he could see “a much deeper role for ASIC in conveying messages about investment principles, primarily directed at self-managed superannuation funds (SMSFs)".
“We would do this for two reasons. First, obviously to educate and help investors. Second, and perhaps more powerfully, to raise the bar for advisers, making it more difficult for poor advice to be dispensed when information about core investment principles is more freely available,” Cooper said.
He said an example of the sort of advice ASIC would be seeking to prevent was the advice given to a number of retail investors, including many SMSFs, to invest in property-related high-yield fixed interest products like debentures.
He said not only were such products often a very poor investments on a risk-adjusted return basis, but investors were often advised to allocate all of their investable savings to them.
“Going forward, we would expect that only the most foolhardy advisers would think for more than a moment about doing this,” Cooper said.
AUTHOR
Mike Taylor
Recommended for you
BT is to launch a new low-cost “Focus” investment menu for its Panorama platform this October, in partnership with Vanguard, seeking to compete with industry superannuation funds.
Net gains of financial advisers have already doubled since the start of FY25, according to this week’s Padua Wealth Data, with momentum gathering pace far faster than the previous financial year.
National advice firm MiQ Private Wealth has appointed a new chief executive to lead the business through a “transformative era” after penning a partnership deal with AZ NGA earlier this month.
WT Financial’s managing director, Keith Cullen, believes the firm’s Hubco model with Merchant Wealth Partners will be a “repeatable growth model” for the business as it scales its adviser numbers.
