The Financial Planning Association (FPA) has called on the Industry Super Network (ISN) to cease its public campaign of fear against financial advisers.
The ISN is currently running press advertisements designed to reassure their members that unlike clients of retail funds, industry super members will not be charged fees for advice services they do not receive.
FPA Chief Executive, Mark Rantall, said: “Enough is enough.”
“On behalf of our professional financial planner members and their clients who represent some $630 billion in investments and retirement savings in Australia, I call upon the ISN to desist from its latest deceptive and hypocritical claims in the best interests of all Australians – their own industry super members included,” he said.
The FPA says the new advertising ignores the fact that many members of industry super funds do not receive in-house financial advice and are unwittingly cross-subsidizing the minority of those who do.
“We have finally seen the true colours of the ISN,” said Mr Rantall. “Given the timing of its latest fear mongering we know that it will stop at nothing to further its self-interested attempts to shut down competition, kill off financial planning services other than its own and extract maximum political advantage.
Any submission made to the FOFA reform process by ISN must be discredited
“Any submission made to the FOFA reform process by ISN must be discredited, and seen for what it is: politically motivated self-interest with scant disregard for working Australians,” Mr Rantall said.
To accompany the advertising campaign, the ISN issued a media release claiming ongoing asset-based fees are ‘commissions by another name’. The statement cites research commissioned by the ISN earlier this year, which the network says demonstrates that up-front fees are up to 17 times cheaper than ongoing commissions.
According to the ISN: ‘Without the opt-in, Australia’s superannuation system will continue to be blighted by the prospect of ongoing advice fees being paid by many retail super fund members for which no financial advice has been sought or received.’
The comments come one month after mainstream media reported that, in direct contrast to advertising claims, AustralianSuper (Australia’s largest industry fund) is paying fees to financial advisers.
As previously reported in riskinfo, AustralianSuper has signed an agreement with six financial advice groups to trial the provision of advice to members.
Paul Schroder, AustralianSuper’s General Manager – Growth and New Opportunities, said at the time that the trial was ultimately about opening the lines of communication.
“We understand that for a planner to be able to advise a client on a particular fund, they need to feel confident about it. Until now they didn’t understand who we are and what our product is about,” Mr Schroder said.
“We’re all participants in the same industry, we just speak a different language,” he added.
The FPA is set to release its own advertising campaign in September. For more on this story, click here.
