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SPAA backs ASIC’s tougher stance on advisers
The SMSF Professionals' Association of Australia (SPAA) has backed the Australian Securities and Investments Commission's (ASIC's) bid to drive out the ‘bad apples' in the financial services industry.
SPAA technical director Graeme Colley said all groups, regardless of size or make up, have a small minority that make it difficult for the great majority.
"Most of the laws are aimed at controlling the minority as the majority do the right thing," he said.
SPAA's statement comes as ASIC's submission to the Financial Systems Inquiry recommended a national exam, a register of all financial planners and the power to ban those involved in managing financial planning businesses.
ASIC said "there is a real and significant problem with ‘bad apples' in the financial advice industry" who switch employment when identified and can attain new employment due to a lack of a proper reference check by a new licensee.
"We particularly support mandated reference checking for advisers that offer Tier 1 or complex advice and would welcome the creation of a central register for employee representatives," Colley said.
"The concept of a national examination for advisers before they can give personal advice on Tier 1 products is also one SPAA supports."
ASIC also urged that it gain the power to ban those in the management of financial advice businesses who are involved in violations.
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The future of superannuation policy remains uncertain, with further reforms potentially on the horizon as the Albanese government seeks to curb the use of superannuation as a bequest vehicle.
Superannuation funds will have two options for charging fees for the advice provided by the new class of adviser.
The proposed reforms have been described as a key step towards delivering better products and retirement experiences for members, with many noting financial advice remains the “urgent missing piece” of the puzzle.
APRA’s latest data has revealed that superannuation funds spent $1.3 billion on advice fees, with the vast majority sent to external financial advisers.
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