The Australian Securities and Investment Commission (ASIC) would collect a levy of around $1,000 for every financial adviser in the industry under a proposed funding model for the regulator’s enforcement activities which has been released by Treasury.
The new levy, which is proposed to apply from mid-2017 onwards, would be charged at the licensee level and is expected to generate $22 million, based on an estimated cost of $960 per adviser for the 23,000 authorised representatives (spread across 2150 licensees) listed on ASIC’s Financial Adviser Register (FAR).
Licensees that provide personal advice on Tier 1* products to retail clients would be charged the adviser levy while those that offer personal advice on Tier 2* products would pay an annual $1500 levy.
“…the levy system would generate around $24 million which ASIC said represents around 10% of its total compliance and enforcement expenses…”
In comparison, licensees that provide general advice only to retail and wholesale clients would pay a $920 annual levy and those providing advice to wholesale clients would pay a $170 annual levy.
In total, the levy system would generate around $24 million which ASIC said represents around 10% of its total compliance and enforcement expenses and is consistent with the time and costs associated with regulating the financial advice sector.
ASIC said the costs have been based on actual and forecast costs across 2016-2017 and invoices for levies for 2017-2018 would be issued in January 2019. Neither the proposed funding model paper from Treasury nor ASIC’s supporting paper detail who would bear the final cost for the levy.
Treasury stated round-tables to discuss the model are set to take place before submissions close on 16 December 2016 with further public consultation set to take place in 2017, prior to appropriate legislation being submitted to Parliament.
Click here to access the proposed funding model papers or make a submissions.
* Tier 1 products are: Securities, Derivatives, Managed investments, Superannuation, Self-managed superannuation funds (SMSF), Life Insurance, General Insurance (sickness and accident), Foreign exchange, Margin lending facilities.
*Tier 2 products are: Deposit Products, Non-Cash Payment Products, General Insurance, Consumer Credit Insurance
Really !!! We have just had commissions restructure by a 50% reduction over 3 years and we now get the honour of paying ASIC for assisting in this. Does it ever stop ??
How about those found to be offending get hit with court ordered fines to cover ASICs fee. I am sick to death of great advisers being tarnished by rogue advisers (if they are advisers at all!). We have already had to wear extraordinary costs implementing FDS and Opt in etc. Goodness me!
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