Following “unfair criticism” levelled at financial advisers in the Senate last week, the AFA is calling for an end to the persecution of the financial advice sector.
AFA Acting CEO, Phil Anderson says in a statement that the “…persistent, ongoing vilification of financial advisers, that we have seen year after year in the Federal Parliament, and in the media, is totally unjust and unreasonable. It borders on abuse and must stop.”
His comments follow debate on the Treasury Laws Amendment (Self Managed Superannuation Funds) Bill 2020 last week.
The AFA says that ALP Senator Jenny McAllister made the statement that, ‘the people who will benefit most from these arrangements are financial advisers giving shonky advice—the kind of advice we’ve seen again and again and again, the kind of advice exposed in the Hayne Royal Commission’.
But Anderson says that the vast majority of financial advisers always work in the best interests of their clients and that the entire profession should not be judged based on what a very small minority have done in the past.
“Other professions are not judged because of what their worst do.”
Anderson also argues that the reference to what the Hayne Royal Commission exposed is also flawed, noting that the Hayne Royal Commission hearings looked at the conduct of 10 individual financial advisers.
“This is a tiny fraction of the adviser population. Importantly, the Royal Commission had access to information on misconduct from numerous different organisations over a 10-year period. It is hardly surprising that they revealed cases of serious misconduct during the hearings, however it is totally unreasonable and unfair to suggest in any way that this was widespread.”
…complaints about financial advice make up only 1.4 percent of complaints received by the Australian Financial Complaints Authority…
He adds that it was important to note that complaints about financial advice make up only 1.4 percent of complaints received by the Australian Financial Complaints Authority.”
Anderson also stresses that the Hayne Royal Commission was not tasked with looking at quality financial advice and successful client outcomes, therefore did not hear of all the great work financial advisers do.
“The Hayne Royal Commission predominantly focused on the conduct of large institutions. It is unfair to slight small business financial advisers based on the cases against large institutions.”
Anderson says the time has come to stop the persecution of financial advisers and to recognise the important and vital role that they play.
The statement also notes that the number of financial advisers in Australia has fallen by more than 30 percent since the Hayne Royal Commission, reducing access and affordability of financial advice for Australians.
The AFA believes that the attacks in Parliament, by activist consumer groups and in the media are one important factor in this decline.
The most heavily regulated sector in Australia
Anderson says financial advice is the most heavily regulated sector in Australia and Senator McAllister’s assertion of inadequate protections for consumers could not be further from the truth.
“There has already been an avalanche of never-ending reforms. Additional measures to supposedly increase consumer protections will only increase the cost of financial advice and deliver little or no benefit to the many Australians who value their financial adviser relationship.”
The AFA says that recent research, completed by CoreData shows that the clients of financial advisers highly value the services they receive from their advisers and highly trust them.
“It is these existing clients of financial advisers who the Parliament should be listening to,” Anderson says.
The association also notes that other recent research reveals that advisers are highly stressed because of what has been done to them and the mountain of change that they are going through.
“Financial advisers are humans, they have families and friends. They have emotions,” Anderson says. “For too long they have been forced to feel uncomfortable talking publicly about what they do. This is not right. No professional should be made to feel this way, and particularly not by elected members of their own Parliament.”
The statement concludes that as financial advice moves into a new era of enhanced professionalism, the AFA is calling on all stakeholders to enable financial advice “…to make a new start, one free from constant criticism and scepticism. One where they can focus on looking after their clients and feel confident they will be respected for the great outcomes they deliver.”
“The time has come. Enough is Enough. We call on all fair minded Australians to make this happen,” Anderson says.
“Other professions are not judged because of what their worst do.”
Other professions have people that have met the standards required to practice.
Anderson also argues that the reference to what the Hayne Royal Commission exposed is also flawed, noting that the Hayne Royal Commission hearings looked at the conduct of 10 individual financial advisers.
Nothing to see here?
Anderson also stresses that the Hayne Royal Commission was not tasked with looking at quality financial advice and successful client outcomes, therefore did not hear of all the great work financial advisers do.
Royal Commissions are not instigated to celebrate good behaviour.
“For too long they have been forced to feel uncomfortable talking publicly about what they do. This is not right. No professional should be made to feel this way, and particularly not by elected members of their own Parliament.”
… and why exactly do they feel this way? Because of the outstanding reputation?
“The time has come. Enough is Enough. We call on all fair minded Australians to make this happen,” Anderson says.
The reason you don’t put your hand on a hot stove twice is that you learn your lesson the first time.
You’re kidding right?
Well said Phil.
We don’t judge politicians based on what their “worst” do. Major political scandals that come to mind. Barnaby Joyce and the “Bonk” ban, Rape allegations within parliament to name a few.
Maybe we should judge the majority based on the minority…
We don’t judge politicians based on what their “worst” do.
Gee, you must walk an ethical tight rope every day.
To My Heart Will Go On – I don’t understand your responses. Are you suggesting that Phil is incorrect? Are you therefore criticising him? Or do you agree, and are your comments another way of saying words to the effect, “No surprise there”?
Everything Phil says is spot on. An adviser added a video of Senator McAllister on Linked In. He also pointed out the flaws in her comments, which as highlighted by Phil, are shocking. Furthermore, all advisers who read his comments agreed.
Phil is right – enough is enough!
In other news .. “Vested Interest Advocates for said Interest”.
I guess public perception doesn’t matter, eh? They’re only clients after all.
Hey [edited]…reveal what it is you do that makes you such an expert on this topic.
I’m fed up reading your completely wrong opinions on all industry media sites about the plight advisers are suffering. It’s blatantly obvious you have no clue whatsoever what its like being an adviser.
So come out from under your teenagers desk and enlighten us with your qualifications on this matter. Not asking you for names – just an understanding as to why we should ALL listen to your expertise and wisdom on this matter. Tell us why you have such blind hatred for advisers.
Eagerly awaiting your reply genius…
Why play the man and not the ball? He or she have quite a few good points. Appealing to the goodness of the Labor party is not going to work. They want us out of business.
Because this genius has been trolling financial advice sites for months about the plight we’re copping, thats why!
If he/she/it is the genius they claim to be, then they won’t have any issue revealing their qualifications on the matter.
Its pretty clear they’re probably nothing more than an ASIC employee, an ambulance chasing legal practitioner who just sees us as a gravy train with the ever-shifting legislative environment we’re now forced to surf or possibly even an enraged former client of an adviser who failed to provide important information to their adviser and suffered the consequences of it as a result.
I understand you don’t like what he/she says but I don’t clock this one as professional troll, though those seem to exist. I doubt ASIC employees would write this – that could come out with bad consequences.
Nothing professional about this clown so I agree. It’s got a bee in its bonnet for some reason about advisers altogether and seems to think we’re all shonky used car salesmen with no ethics and that we’re making millions. I’m sure you’re not, I know I’m not and I reckon 98% of our colleagues aren’t either but this goose keeps focusing on the windscreen scratches instead of the far bigger picture.
If I could be either of those things, then it isn’t “pretty clear”, is it?
Yet, still no confirmation of what your expertise actually is. Pfffft!
Comment withdrawn, re-entered as a fresh post.
Phil is spot on and I feel his frustration, he articulates how many of us feel very well.
If I can add my 2 cents worth, financial advice is vitally important, whether it is relatively basic advice or more complex. An increased base line of professional standards was needed. However, the ongoing bashing and attempt to bury and dance on the grave of the advice sector by some who are blinded by ideologies will help no one. The lack of access to basic advice services such as tailored risk protection will have a devastating impact on members of our community in years to come.
Phil has good intentions and I agree with him too, Tim. Sadly it is too late though. The AFA, FPA et al should have fought harder, earlier, along with the heads of life companies. Instead the companies sold us out – did NOT champion our cause (their cause!) and the likes of the FPA board gave platitudes and continued to accept their obscene paypacket each week. I still find it beyond belief that risk advisers who run a completely different and separate discipline to full financial planners/investment advisers did not have an appropriate, relevant and constructive designated exam and qualification process. I and many other riskies would probably have stayed if this was done properly – it is only common sense.
Squeaky, I can tell you that AFA fought hard with passion and clearly articulated concerns about the trajectory personal advice is on, particularly with regards to risk insurance. The problem lies squarely at the feet of those who have governed over this transition, and those who have advocated for things to progress in this direction, they have appeared blinkered to the concerns raised. The AFA was very clear from the outset that change, while necessary, needed to be managed carefully.
‘My Heart will go on’ is a troll….don’t feed the trolls, and especially don’t argue with them. Dropping to their level won’t solve our challenges.
The irony in your statement and the following is delicious:
“Financial advisers are humans, they have families and friends. They have emotions,” Anderson says. “For too long they have been forced to feel uncomfortable talking publicly about what they do. This is not right. No professional should be made to feel this way, and particularly not by elected members of their own Parliament.”
It should be expected that when you say silly things that you get a silly response.
Grub! Pure and simple. Leftwing, uninformed and bitter grub.
Yes, how dare I call out hypocrisy. You can go back to your sense of superiority now.
Hey clever-dick…you want to talk about hypocrisy (of which you have no basis to form)
You might want to take a look at the following stats about how just unethical you think advisers are compared to the FACTS, genius…
1) 80% of SMSF funds are established by individuals NOT Financial Advisers or Accountants. Relatively speaking, few Financial Advisers advise on SMSF’s, consumers want the DIY aspect to manage their own assets. (So, we’re not the problem here)
2) Only 5% of all Australian Financial Complaints Authority [AFCA] complaints are about Advisers, 95% are against Institutions. (Advisers CLEARLY aren’t the problem here either)
3) The ASIC 627 Paper ‘What Consumers think about their Advisers’ found 89% of Consumers trust their Advisers from an 2500 independent survey. (Clearly again, advisers are far from being the unethical beasts you deem us to be!)
More importantly to some, in the latest ROY MORGAN IMAGE OF PROFESSIONS 2021 SURVEY, Financial Advisers were rated twice as high as Federal Politicians! (So, we’re not doing that badly – hah!)
You’re a fools head with nothing but a twisted sense of reality.
While I can say good on Phil Anderson for voicing this I will also say I fear it is far too late. All thinking advisers that are able to have left or are planning to (full planners AND riskies) and the self absorbed politicians (on both sides) and the special interest groups will continue to persecute advisers of all stripes. Why? Because they can. They can and they will simply to make themselves look relevant and get what they want – for pollies that is getting re-elected.
I wonder if it has dawned on the execs of life companies that it was a mistake not to champion the cause of the life adviser, to fight the 2 year clawback and not welcome it like they did and not to fight lower commissions like they did and not to champion a seperate exam and qualification for THEIR advisers? Well, the writing should be on the wall now in non-removable graffiti paint! If the mess their companies and the life industry and is in now doesn’t resonate with them then nothing will – only getting worse from here. Idiots all, the only thing any of them had to do was listen to their advisers and act on just ‘some’ of the things we told them about how this would end up and how to fix it.
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