Ripoll signals licensing changes
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The Ripoll Inquiry is certain to recommend a change to the “anomaly” of having one standard licensing regime across a financial planning sector with many products.
Inquiry chief Bernie Ripoll told Australian Financial Association conference delegates on the Gold Coast yesterday that the Australian Financial Services Licence was “one single framework that is meant to distinguish somehow all of the services that are provided in a massive sector, as well as all of the different people and all of the different levels of expertise".
“We want to provide a clearer and more defined sector that is satisfactory for you and those who use your services as well,” Ripoll said.
He added that the inquiry had “certainly had a lot of recommendations in this area about what does work and what does not work”.
Commission payments and marketing and advertising campaigns are two other areas that the inquiry — which will release its findings in less than two months — has had a “very close look at”.
Stating the commissions “by their very nature represent a conflict”, Ripoll said this was an area in particular that the inquiry was “determined to find some clarity on”.
“We want to find a reasonable, sound model that will provide the consumer protection we all expect and also serve the future of the financial services sector well.”
Submissions to the inquiry also revealed that there needs to be a close look at advertising and marketing campaigns in the sector, he said.
“People are sick and tired of ads that make unrealistic claims that somehow guarantee returns of 10 per cent, 12 per cent, and 16 per cent with words such as ‘safety’ intertwined with disclaimers.
“It is something we want to stamp out and to make sure that the advertising is clear and reflects the actual products,” he said.
AUTHOR
Mike Taylor
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