Report intra-fund advice problems to ASIC says Hume
Financial advisers who believe superannuation funds are breaking the rules around intra-fund advice should notify the Australian Securities and Investments Commission (ASIC), according to the Assistant Minister for Superannuation, Financial Services and Financial Technology, Senator Jane Hume.
In a letter responding to a West Australian adviser’s concerns about intra-fund advice, Hume said superannuation fund trustees were expected to have internal policies in place to “manage the costs of intra-fund advice and ensure it is not used excessively by any particular member to the detriment of others”.
“Where you have concerns that a fund may not be disclosing fee arrangements or providing intra-fund advice in accordance with the law, I would encourage you to contact ASIC,” Hume’s letter said.
The minister’s letter also suggested that the Hayne Royal Commission had given intra-fund advice a clean bill of health.
“The advice and superannuation industry was thoroughly examined as part of the Financial Services Royal Commission and in his final report, the commissioner noted that ‘there is no suggestion of misconduct in relation to intra-fund advice’,” Hume’s letter said.
“There are rules in place to ensure to ensure that intra-fund advice is not ongoing advice, and cannot be complex or about topics other than the member’s interest in the fund,” it said. “In addition, there are obligations on advisers providing intra-fund advice including the best interest duty.”
“I note that the implementation of the Royal Commission recommendations such as the new professional discipline regime for advisers will apply to those offering intra-fund advice,” Hume’s letter said.
Recommended for you
As the first quarter of 2024 comes to a close, Money Management looks back on the corporate regulator’s bans and AFSL cancellations in the financial advice sector.
Insignia Financial is holding ‘relatively steady’ onto its rank as Australia’s second-largest financial advice licensee after the Godfrey Pembroke exit but Count is hot on its heels.
Liberal senator Slade Brockman has said the government needs to have a “cold hard look” at the level of regulation in the financial advice space and the costs of running a business.
FAAA chief executive, Sarah Abood, has warned changes in the first tranche of the QAR legislation around advice fees documentation could create more work for advisers rather than less.