At least one responsible manager within advice licensees will need to have both passed the financial adviser exam and to have satisfied the degree qualification requirement under new proposals outlined by the Australian Securities and Investments Commission today.
ASIC has released a consultation paper on updated competence requirements for advice licensees updating Regulatory Guide 105 to support professional standard reforms.
Commenting on the proposals, ASIC Commissioner, Danielle Press said they were designed to strengthen the organisational competence of financial advice licensees by ensuring that advisers were supervised by at least one responsible manager who satisfied the new education and training standards.
“We would like to add to the existing options for responsible managers to demonstrate their knowledge and skills by introducing a new Option 6. This option will reflect the higher levels of competence expected in the industry,” she said.
ASIC is proposing that:
- advice licensees would be required to have at least one responsible manager who satisfies Option 6;
- responsible managers who wish to satisfy Option 6 would have to pass the financial adviser exam, satisfy the degree requirement that apply to existing financial advisers, and meet the CPD requirements; and
- both new and existing responsible managers who wish to satisfy Option 6 would have until 1 January 2021 to pass the exam and until 1 January 2024 to satisfy the degree requirement.
Comments
This will be fun.
… and the specific requirements remain as vague as they were to start with ….. don't have a problem raising the education 'bar' but am becoming concerned with the tightening time frame within which I will need to go back to school !!
Small Licensees could be out of business very quickly
Don't you mean all licensees!
Why? In most small licensees the RM is a practicing adviser who will have to meet FASEA requirements anyway. It is the larger licensees who use product sales people as the RM who will be most impacted by this change.
Deano, your assumption is that everyone is going to pass an unknown exam and meet the overall education standards on time whilst still trying to balance running a small advisory business as well as an AFSL. Who would would meet FASEA guidleines and work for a big insto/license anyway as a RM.
Looks like all AFSL's are going to struggle to survive FASEA as well as individual advisers.
Not quite my assumption. I actually think lots of advisers will leave the industry by either failing, or not attempting to meet, the FASEA requirements. But those practising advisers who have been through the process of getting their own AFSL are unlikely to be too put off by FASEA.
The pace of change, by 2024, Advisers will all need to be self licensed.
How many financial planning senior executives in the banks are qualified as advisers or have practiced as advisers in the last 15 years? From my experience virtually none. No wonder their remediation programs are so large and unexpected. The senior executives making all the real decisions do not have a deep understanding of the intricacies of financial planning.
The issue here is they are just running an exam for an exam's sake, and to hell with the consequences for hundreds of thousands of existing clients, while making no effort to clarify the education required to pass the exam. This is ridiculous.
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