Amid continuing adviser concern about the Financial Adviser Standards and Ethics Authority (FASEA) code of ethics, the Financial Planning Association (FPA) is promoting the fact that FASEA chief executive, Stephen Glenfield will be appearing at the FPA’s national congress this week to explain the authority’s position.
And amid suggestions from some quarters of the advice industry that the Australian Securities and Investments (ASIC) may have influenced the code, the FPA has confirmed that a Glenfield will be sitting alongside an ASIC representative and a Tax Practitioners Board (TPB) representative in a regulatory workshop.
The FPA congress is occurring at a challenging time for the organisation with its annual report confirming declining enrolments for its Certified Financial Planner (CFP) designation, the Government’s decision not to proceed with code-monitoring bodies and with adviser numbers across the industry generally declining.
Despite the general decline in adviser numbers, the FPA annual report pointed to 1,530 new members albeit that membership subscriptions were down on 2018, alongside so-called partner fees and the CFP program.
In his statement accompanying the announcement that Glenfield would be discussing the code of ethics at this week’s conference, De Gori said FPA members were seeking greater clarity about the code.
“This will be the first time that financial planners have the opportunity to hear direct from FASEA since the code of ethics guidance was released in October,” he said.
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CFA = certified financial adviser ? Really ? I always thought that it meant Chartered Financial analyst. I expect the CFA boys and girls would be pretty upset that the FPA has taken this over and they sit alongside the CFPs. I’d suggest it is a typo. But the bigger issue is the FASEA pushback being exhibited by the old guard. Argue about the guidance all you like but the COE won’t be changed and that’s the thing we should be focussed on. Trying to manipulate the interpretation of the FASEA COE won’t help if in the future, you’re in court as a defendant. There’s plenty of material in the RGs and PSs issued by AS)C over the years. Documents many have basically ignored. There’s plenty of us that don’t have a problem with FASEA and have/are adjusting our business to accomodate this having worked out long ago that the old business model is dead.
When very directly questioned by Senator Amanda Stoker at the recent Senate hearings as to whether ASIC had been involved in the submissions and recommendations regarding the Code of Ethics, Stephen Glenfield elected to avoid that specific detail and instead provide a generalised answer stating that several groups were involved in providing feedback and submissions.
If ASIC were involved in the process as one of the several other organisations involved, why would Stephen Glenfield feel it necessary to not confirm this specific detail when questioned by Senator Stoker ?
It was a straightforward question that required a straightforward answer.
The issue is that none of this process has been straightforward at all.
It is widely suspected that interest groups such as CHOICE and the Consumer Action Law Centre may also have had input into the Code of Ethics and specifically into recommendations regarding the re-wording of Standard 3.
If this were to be true and with 3 current FASEA directors with significant background with these groups, is this process acceptable on any level when it is very widely known these groups have been aggressively campaigning for years against adviser remuneration models.
At the FPA Conference this week Stephen Glenfield and ASIC must be asked the direct question in a common forum whether ASIC were involved in the recommendation to revise Standard 3 and if so, exactly what was recommended by ASIC.
I fully expect that there will be many attendees at this conference who will be demanding answers to be forthcoming immediately with no option to be taking questions on notice whatsoever.
We don't want clarity. We don't want 'guidance'. We want the Code changed. No amount of spin from Glenfield will salvage this outrageously naive and unworkable document.
Glenfield's explanations of the FASEA Code remind me of a gun manufacturer... "Oh the intention of guns is that they are only ever used by sensible people, in a responsible way".
What he fails to acknowledge is that the FASEA Code will be used as a weapon by ASIC, AFCA and the Courts. And there are some people in those organisations who are willing to use any weapon at their disposal to impose their own personal bias against financial advisers. The ambiguous FASEA Code is a loaded gun to those people. Glenfield's non binding verbal explanations are powerless to disarm them.
Good analogy, but how do you know Glenfield (and the majority of the FASEA board for that matter) don't also have a personal bias against financial advisers? If FASEA was acting in a rational, measured way, then surely they would have engaged with practicing advisers, conducted research and properly tested the Code of Ethics before releasing the final draft? Especially when it contains such radical, transformational elements.
So now the Australian Institute of Superannuation Trustees also have major concerns with FASEA's Code of Ethics and how several of the standards will actually apply in practice.
It is understood that Eva Scheerlinck has asked for clarification from Stephen Glenfield regarding several major concerns .
This cannot proceed at this point based on a number of very serious concerns with the Code of Ethics.
We have representative associations, advisers, politicians such as Zali Steggall , Senator Amanda Stoker, Bert Van Manen and now the AIST all calling for clarification and delay in regard to the start date of the Code of Ethics.
Minister Hume simply just cannot ignore the calls for concern and must act immediately.
A refusal to act and place a stop on the legislative instrument at this stage, effectively ignores the very real concerns of so many.
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