RC will force regulation, but less is more

24 August 2018

The consensus across industry experts is that a post-Royal Commission world will involve complete and full disclosure, but more paperwork and onus on the institutions won’t work, a panel has told Money Management and Super Review’s Future of Wealth Management conference.

The experts said while the Royal Commission was much more consumer-orientated than it was originally thought to be, whether consumers were aware of the compliance burdens placed on institutions was “another story”.

“It’s more paperwork into the system … and none of it protects the clients,” added Steve Davis, chief commercial officer, Infocus.

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“Somehow, regulators need to understand that less is more, but unfortunately that won’t come out of the Royal Commission.”

When asked if industry funds got off lightly, AustralianSuper group executive, Paul Schroder, said people had forgotten the human impact on those involved.

“The only message I’d like to convey is don’t forget the human impact on the people in this broader financial services industry of this Royal Commission,” he said. “If you’re involved directly its exhausting, and if you work in an institution that’s involved, it challenges and upsets your confidence.”

But other panellists thought they had, with Grahame Evans, managing director, GPS Wealth, telling the conference that industry funds didn’t receive the intensity of interrogation as the other institutions.

David Murray, CEO of Sterling Private Wealth, said industry funds were fortunate because of where the Royal Commission directed its attention in its early stages.

“I think the order has been quite deliberate,” he said.

The experts were hesitant to place onus on the regulators though, with Evans telling the conference that regulators have had to “battle hard” and negotiate against “some really high power”.

Annick Donat, CEO of Madison Financial Group, said it was unfair to judge the regulators against the Royal Commission.

But, all the experts agreed the Royal Commission was timely and necessary, with Schroder indicating that the general public “needed it”.

“It reminds the executives and the boards and owners that it’s not their money,” he said.

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“It’s more paperwork into the system … and none of it protects the clients.” What a joke. Nothing seemed to have protected the clients given the disclosures of banking and financial services executives rent by the counsel for the Royal Commission. Maybe time in prison for such people doing such criminal behaviours might solve the need for paperwork in the future.

Agreed, throw away the key on them as well as those sitting on ISA boards or even high ranking ISA employees making those dodgy deals, payments and decisions, hey Hedware?

Yes the RC didn't say much about ISA employees making those dodgy deals, payments and decisions. Just one case, which paled into insignificance given the largess that I have experienced at events put on by the for profit lot.

Maybe something might in the RC final report that will satisfy the blood lust that some here have for not-for-profit funds. Probably a stretch to match what has been revealed about the parlous behaviours of the profit funds.

"We've got a problem Sir, we're running at a profit."

"Well you better revise your entertainment budget then."

HW still see you defending the great red dream but neglect to answer my simple two questions to answer directly and not defray with pointing the finger elsewhere:
Have you properly researched any of the problems stated with ISA funds or any of the myriad others that I fatigued before stating (all have had plenty of public airing)?
Given these, can you in good conscience honestly say that they deserve your utter blind loyalty and endorsement at ever single opportunity and yet still maintain any air of professionalism or personal integrity, with no other personal or professional motive or agenda?

1. No - but you seem to know more about ISA than I do. I just deal with for-profits
2. No - but I can still maintain my professionalism, integrity and balance towards a better and transparent system for supernatants and investors.

Did you mistakenly drink some of the Blue Kool Aid Hedware?

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