ASIC has committed to making a number of changes over the next year or two to improve the way it communicates the requirements for providing compliant financial advice, according to the AFA.
It says the the Parliamentary Joint Committee on Corporations and Financial Services, which is responsible for the oversight of ASIC, held its most recent hearing with ASIC on 19 March 2021, which was also the first hearing conducted under the new PJC Chair, Andrew Wallace, who is the LNP Member for the Sunshine Coast seat of Fisher.
The statement says that Andrew Wallace and Liberal National Party MP, Bert van Manen, asked questions about the rising cost of financial advice. They inquired as to what action ASIC is taking to reduce the cost of advice and to rationalise the documentation that advisers are required to provide.
“ASIC spoke to the work that they are doing and committed to making a number of changes over the next year or two to improve the way they communicate the requirements for providing compliant financial advice,” the AFA says.
In its message to members, association says it has recently met with Wallace and knows that he is in regular contact with financial advisers from within his electorate.
It says Wallace asked a number of important questions, including “…a detailed question on Fee Disclosure Statements and getting to the bottom of the fundamental difference between how Fee Disclosure Statements are produced by financial planning systems and what ASIC expects.
…ASIC openly acknowledged that this was a legislative problem and that they will be talking to Treasury about how this problem can be fixed…
“This question got to the core of the issue with timing differences, GST/RITC issues, and small differences. ASIC openly acknowledged that this was a legislative problem and that they will be talking to Treasury about how this problem can be fixed.”
The AFA says it has been calling on the Government to fix this issue for more than a year, and notes that Parliamentary hearings are an important part of the governance process with respect to the oversight of ASIC and Government agencies.
“We pay close attention to these hearings in order to understand the key issues and to ensure that we are across the emerging issues.”
Click here to watch a short video of the PJC questions highlighted by the AFA.
The same rubbish from ASIC, Ms Press, they will not admit fault and thus will not solve it. 10 years ago there was an almost exact ASIC research review on increasing Advice costs. Since then the BS Regs have only exponentially increased. Seriously morons running Canberra or real intention to actually kill Advisers.
STRANGULATION BY BS REGULATION CONTINUES TO GROW !!!!!!
ASIC sees no value in ongoing advice but sees enormous value in not being embarrassed in a Royal Commission, therefore there is no downside for them in destroying financial advice. There will be plenty of other things to do for them.
Of course they won’t be that cynical. The trouble is that their actions are indistinguishable from the above course of action and so are the actions of the government and the opposition. I wonder what the market drop in March 2020 would have looked like if there were no more advisers. There would probably be the same volatility as in an emerging market where there are only a few big buyers and sellers and when they collectively panic …
ASIC stating they are committed to making some changes in a year or two, when they have had several years to fix the issues, is akin to directing vehicles to drive off a cliff and then telling the survivors that we will endeavour to rescue you after we have some extensive investigations into this situation.
Then when it is pointed out that ASIC is still directing more vehicles off the same cliff, ASIC will then make an executive order to set up a committee to discuss why this had occured.
Then after hundreds of vehicles are laying at the bottom of the cliff, with mass casualties, ASIC will spring into action and recommend that all roads be closed until a thorough investigation into the perils of roads and cliffs is determined.
As absurd as this sounds, the ASIC direction around Life Insurance churn and the subsequent driving of ethical and experienced advisers over a financial cliff, through inept interpretation of how to hold the sign post and guide the Industry in a manner that benefits, not hinders the Life Insurance Advice Industry and all Australians, is not too far removed from what ASIC has done and still continues to do today.
I want to know why other industries aren’t required to produce FDSes, Opt-Ins or SoA style documents for any advice they give. Looking at you Doctors, Lawyers, Accountants & Engineers
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