In its response to the airing of Four Corners’ investigation, FPA chief executive Dante de Gori wrote in a public letter that the association “does not condone any situation where a client is charged fees for no service” or any situation in which clients are given inappropriate advice for their circumstances.
“This sort of behaviour is a breach of the FPA Code of Ethics and Professional Practice, and against any measure of common decency,” the association said.
“A professional financial planner or practice is expected to know the law, abide by the law, and put their clients’ interests first. The professional obligations that must be upheld by all financial planners who are members of the FPA are captured in the eight principles of the FPA Code of Ethics.”
The airing of the episode comes as AMP is commencing its defence against a shareholder class action, which also stemmed from revelations made before the royal commission, with plaintiffs arguing AMP did not meet its disclosure obligations to shareholders in relation to the fees for no service scandal.
“AMP confirms it will vigorously defend this and all similar proceedings,” the company said in a statement released on Monday.
“AMP denies the plaintiff’s allegations that it had information that was required to be disclosed to the market during the relevant period.”
What are you going to do about AMP Mr De Gori? I thought so.
I stopped paying my FPA membership this year after many years as they are simply out of touch for my needs as a financial planner. Dante has just provided yet another reason to vindicate my decision.
What AMP did was wrong, of that, there is no doubt. In the meantime, industry super funds continue to employ financial planners who provide conflicted advice to a tiny percentage of advisers and pay them from the benefits of all members.
Does anyone here even want to be an FPA member? The industry body that abandoned their members and has a sole interest of revenue raising and course flogging. Go away FPA, your days are over.
some people will continue giving their money away for nothing if you like donating money there are many worthwhile causes please consider them instead
Dont want to be, but need to be due to the tax prac board… They hold people at gunpoint to be members essentially. There is literally zero benefit otherwise.
[quote=Anonymous]A pathetic response from a pathetic association. FPA happy to take AMP’s financial support so would never expel them however bad they are, just a quick meaningless response and Dante will keep taking their financial support to pay his over inflated salary. Time the FPA closed up shop. Corrupt worthless group. [/quote][quote=Jape]So says the Anonymous poster to the IFA website with errors in spelling, grammar, punctuation, syntax and ludicrous new expressions! WTF is “bandwagon hopping”. Ignoring your waffle, most FPA Members would see this statement as an important comment by the professional body.[/quote]. Spot on & accurate.
For whatever reason their are planners out there that cannot see the value of having an independent adviser only association that truly reflects the voice of all Australian advisers (AMP & Non aligned etc) and yet is more than an industry association in that it also reflects the needs of the Public first. If FASEA and the RC, LIF can’t persuade advisers to act and write to the FPA to get rid of the Professional Partner Program and this conflicted relationships with firms like AMP then I do not know what will.
If the FPA wants to continue to put the needs of product manufactures equal and above of the needs of the public and advisers then now is the time for a brave retired/semi retired sole with time to set up a new association that is representative of ALL advisers. Advisers need to start thinking if joining the FPA solely for the sake of CFP letters and paying $1,000 a year is really worth it. Their are plenty of other bodies out their at half the price.
I dont know anyone who sees value in FPA membership (or AFA). The only value is that they have a monopoly over TASA. I am merely a member because I have to be to discuss tax in advice…
As soon as there is a better tax option my membership is cancelled, Id say there would be plenty that feel the same way. The FPA would know this too.
you can join the institute of public accountants as an AR, AFSL licensee, or Individual tax (financial) adviser
they are a legally recognized accounting body under corps act, so no issues meeting any TASA requirements. there are many other bodies recognized by the TPB
50% discount too on membership fees, and very relevant CPD etc lots on offer
Walk the walk FPA.
Wishful thinking.
Cancelled my membership this year.
Typical of the FPA, they are always re-active, never pro-active. If I didn’t need my CFP status, I would have cancelled my membership years ago. Yes, this is a story that needs to be clarified and explained, but the big issue is the lack of authority shown by the FPA and AFA in the ongoing saga of planner fees.
For years we have been charged fees, even the marketing levy of a few years ago, but what did we get for it? 4/5ths of 5/8ths of buggerall.
Lets introduce a new planner body, one that actually works for the planners, not the intuitions and make it relevant in today’s world.
may I humbly ask what your CFP status does for you?
I am interested in genuine replies only please as I am new to the industry and have a master of financial planning completed at AQF 9 and fasea recognised and I really don’t understand why I would do the CFP as I am exempt from all technical modules and have to do the standalone ethics for fasea as well as the exam
so for me, and many more like me the CFP is not worthwhile or is it ?
Leave this ridiculous industry while you can. You really don’t want to be subject to this pathetic political football career. Seriously, leave.
Im CFP and its not worth it mate. Until its considered a qualification (dont have to pay fees to retain it) there isnt much point.
Many keep paying FPA fees because they were given CFP status without studying for it. They will keep paying fees because that is the only thing they have other than a basic DFP. Keeping up appearances.
Why have a CFP its not worth a cent under FASEA
A pathetic response from a pathetic association. FPA happy to take AMP’s financial support so would never expel them however bad they are, just a quick meaningless response and Dante will keep taking their financial support to pay his over inflated salary. Time the FPA closed up shop. Corrupt worthless group.
Great platitudes Mr De Gori, but zero credibility. Expel AMP from the FPA
There are no platitudes in the statement.
Planners don’t give a rats about their profession. They are happy being compared to used car salesman. They are happy with red tape, turning away ordinary Australians who can’t afford advice, happy given people reams of paper that serve no benefit, other then to meet some compliance requirement. They are more than happy for an association that puts forward Treasury submissions getting payments from Product makers like AMP.
Myself I find it embarrassing when I tell a client their advice fees are not tax deductible. I find it embarrassing when I have to get clients to sign 3 forms to charge a fee. I find it embarrassing when I’m called uneducated and my local hair dresser is considered more qualified. I find it disappointing yet understandable when Treasury dosen’t listen to the FPA.
When an organization like the FPA which claims to be “professional” and places the Revenue from AMP above the needs of Australians and all Financial Planners (AMP and the like) well that’s very embarrassing and in short corrupt and ethically wrong. So bring on the over regulation, the banning of all commissions whether that’s grandfathered or not, because no one cares anyway.
Seems Dante de Gori can’t put a foot right. It’s always stuck in his mouth!
Take money on one hand for a professional partner program and kick ’em when their down.
Let’s see ASIC close down AMP like it was going to with Dover for all the same reasons.
The FPA has little relevance so perhaps it shouldn’t squawk too loudly, proudly and boldly lest members seek clarification on it’s own failings on fee for service!
I am a Senior Staff member of the Advisory team in AMP. I tried to tell AMP that this would blow up in our faces and we’d make all planners whether AMP or unaligned look bad, but fearing for my job I said nothing and I wasn’t Senior enough anyway.
So I tried also to tell the FPA but are they going to listen to me, No. Just look at how long they took with Sam H. Given all the money the FPA makes off their puppet masters (AMP) and all the members who get subsidized fees paid for them, what hope would I have had. So I said nothing…I guess I should of said something…so I’m sorry I let you all down….but hey isn’t that just one of the functions of the FPA really anyway, to help protect people like me, and other members of the FPA and other Australians? Why else does membership fees costs $1,000. I guess on this occasion they’re more interested in protecting a revenue source and their relationship with AMP. No wonder FASEA or Treasury won’t listen to them or You. God help us all come the next election with ex AustralianSuper executive Bill Shorten is taking instructions.
associations don’t really have any relevance in this day and age. it’s a gravy train, they pat each other on the back and collect their large salaries and do very little for it. it’s so easy, risk free annuity income almost guaranteed courtesy of suckers that are members of the FPA and continue to be despite all this
happy days, think i am going to open an association myself I’ll be CEO, pay myself $400,000 plus bonus
my passions are 5 F’s (1 more than Dante’s, he has 4 FP’s only) family, fun, friends, financial planning, and football
who wants to join, $600 annual fee, $750 marketing levy, and $150 pa for my perks
Hey just wondering if we can kick in some money, to help get some what we want?
Don’t apologise AMP Whistleblower – I’m sure you did what you thought best for your and yours at the time. I’ve been in your position – witnessing wrongdoing at CBA – and couldn’t bring down on myself the $hitstorm that I know that Jeff Morris went through with them. At the end of the day, as we saw with Sam Henderson, vertical integration is a key cause of wrong-doing in this industry. The big players need to decide on which side of the field they wish to be – are they product providers or are they advice businesses – but it’s become clear they can’t be both. And industry super funds need to have a think about their ‘intra-fund’ advice and ring-fence tactics too.
I hope you’ve found a better role for yourself and you’re in a less-conflicted and happier place now.
This is a disappointing response. AMP is member of the FPA and their fees are bundled up an called member fees on their annual report. To quote the FPA. “You work in partnership with the FPA to share the future direction of the profession through a close working relationship with the FPA executive team”. Just how is Management shaping the direction of Advice in Australia? [b]What’s next…Sam Henderson for CEO?[/b]
Issuing a press release/ statement is not good enough. They need to go further and either kick AMP out, suspend their membership or fine them. I am not saying kick AMP advisers out I am saying the FPA needs to act for members and not product providers. However AMP is classified as a member of the FPA and they need to treat them accordingly. Just why do you join the FPA? The whole purpose of a professional association is to prevent over regulation I didn’t join the FPA for cheese and crackers nor for the bonding session as I have enough friends.
I joined the FPA because I want to prevent over regulation. With FASEA, the Royal C, FoFa the FPA has failed in it’s charter. I’m currently doing a tax course for to meet TPB requirements and won’t be a member going forward. I will join one of the other 10 “industry” associations as the fees are cheaper and there is clearly no point in having a professional association.
The organisation currently being lead by Mr De Gori which continues to lose relevance in the current environment is charging significant fees and is neither required or able to demonstrate what services they are delivering to individual members. Totally hypocritical and bandwagon hopping. When will the FPA deliver an annual Fee Disclosure Statement with delivered services to each of it’s members? We know the answer. How has the FPA delivered against the requirements of FASEA? It hasn’t. Suggest Mr De Gori focus his energies within and star to actually lead some genuine change for the members he is paid to represent.
So says the Anonymous poster to the IFA website with errors in spelling, grammar, punctuation, syntax and ludicrous new expressions! WTF is “bandwagon hopping”. Ignoring your waffle, most FPA Members would see this statement as an important comment by the professional body.
Sorry the original poster is spot on. The FPA has lost it’s relevance and is out of touch with it’s members. I don’t get conflicted remuneration from product providers, the FPA does. I don’t get volume based payments, yet giving 10% off member fees based on your employer is a conflict. I don’t bundle up fees in the same manner that the FPA bundles up payments from AMP and ordinary members and call them member fees. So yes they are irrelevant and living in the 80’s. Please stop using the word “professional” association and the FPA in the same sentence. Please google the meaning of a Professional association, do some research on the professional partner program, look at other professional associations and come to a conclusion as to whether you think they are professional. This is the very same professional association that advertises it’s CFP program is equivalent to AQF standard.
Please everyone take a breath. If a client hasn’t been seen in 15-20 years they are not paying advice fees. The payments to the adviser would be commissions paid by the product manufacturer. Don’t start judging the past by today’s standards.
Lol yeah, commissions built into the product making it more expensive to the client… Should not get paid if you haven’t spoken to a client in 12 months, let alone 15-20 years.
Amen, Anonymous! What absolute maniac would dare scrutinize the past actions of advisers based on modern expectations!? Like you, I am also trapped in the late 1990’s and staunchly oppose changing any aspect of my life in line with technological advancements/societal demands. If you ever want to discuss our antiquated ideologies and inability to adapt just add me on Myspace – I’ll accept your request once my dial-up stops screeching/ as soon as I download the latest Backstreet Boys album off Napster..
this is what the AFA did to me for al the years I ws a member so maybe they should be prosecuted charging advisers fees for NO Service like the lead up to LIF and the FSC buddy up job they did on there members
Does the FPA condone charging membership fees for no service?
Most institutions like AMP and the major banks are simply too big and too greedy for market share to care about their individual clients so many will simply fall through the cracks and regarded as collateral damage, of little consequence. Their systems and processes likely work OK for the majority of vanilla customers (note the use of the word customer – a “client” evokes a sense of caring) but anyone whose situation is slightly askew may not be catered for and is hence disregarded for the majority. Sad. This culture manifests broadly in our society across all sectors and levels (business, sport, government etc) resulting in corruption of a magnitude we are starting to accept as normal.
Is it a breach under FPA Code of Ethics and Professional Practice to ask the Royal Commission not to name celebrity financial planners? Obviously not
there needs to be legal clarification over what are fees for no service and what are inbuilt product commissions. both are getting confused and the consumer once again is at a loss. there are consumers seeking legal advice and getting charged for that advice thinking they have been subjected to fees for no advice when in fact they are getting commissions deducted from products they invested in that were manufactured with commission built in this way with ASIC’s sign off or a PDS that is a legal construct.
But… to use the words of QC Orr. “what’s the communities expectation?” Like payments to Unions from Super funds commissions were always a marketing expense, however getting a commission is increasingly becoming a dirty word and not in line with the communities expectation. We are an easy target for further reform and we must be seen as self regulating. A mere statement from the FPA will not go near enough for any review of the advice industry to be seen as sufficient. The FPA should have no links whatsever with the FPA. This is why the FPA needs to come down like a tonne of bricks on AMP.
The Four Corners program on AMP was not new news and the FPA have known about this from the RC and now they come out! They are doing this as they were too were shamed and put in the limelight with the Sam Henderson debacle. Come on Dante were not stupid and do remember….
As accredited AMP advisers running our own practices … why are we continually drawn into this fiasco with the implication that we have been giving bad or inappropriate advice? The whole issue for AMP at the Royal Commission revolves around planning fees still being received by AMP after the adviser has handed back the clients. We as AMP planners have done absolutely nothing wrong by our clients. How about the FPA show us as fully paid up FPA members, some overdue support here!
They are showing you support. By the industry self regulating Roderic we can prevent over regulation and events like FASEA and LIF going forward. We must be seen as to be doing something, otherwise we’re just puppets of firms like AMP. Most AMP advisers I know are good advisers and it’s not a personal attack.
Unfortunately the status quo is that most AMP advisers are DFP only ‘experienced’ operators who just still focus on flogging super and risk, no different to 20 years ago.
Until that changes, any association with AMP and advisers will get tarnished.
So Dante, what measures will the FPA be taking against AMP Advisers clearly in breach of the FPA Code of Ethics ?
And what will the FPA be doing to AMP as a business and the managers, board, etc who have actively encouraged the law to be broken and overseen all these breaches of FPA code of ethics ?
OOOHHHH let’s write them a stern public letter – so scary Dante, so meaningful FPA. NOT !!
What a joke the FPA is.
Be interested to know if the FPA were contacted by Four Corners for an interview?
Will the FPA therefore be terminating AMP’s “Professional Partner” status? Surely AMP has breached the spirit of that program if not the specific rules as well.
The FPA should really terminate the “Professional Partners” program completely, along with the “Professional Practice” program and grandfathered CFPs. A true professional association should be purely for individual members, who have met a professional standard of education and assessment.
The whole practice of charging “fee for service” as it stands today is an absolute con. A rort. A rip off. You can not and would not be able to justify ever6 one of your clients pay an annual fee just to be your client. Get real people. You know most mums n dads do not need you dipping your hand in the cookie jar every quarter just because they have set up an investment or superfund with you. Wake up ASIC. Every financial planner doing this fee for service rort should be in you radar.
If an advisor stole hundreds of thousands of dollars from their clients the result would be disqualification & gaol time. No amount of contrition or remediation would prevent this. Four Corners presented enough evidence that the executives of AMP endorsed wilful theft from clients. Surely AMP is not ‘fit & proper’ to hold an AFSL. Where is the criminal investigation & AFSL cancellation? ASIC has been aware of this situation for years. More so, why is the FPA not advocating this?
Clearly the only way to avoid this scenario is to obtain payment upon review, not via the monthly arrangements most often seen. No pay, no review. Do all people even need an annual review, why not every two years or three? This is turning into a big big thing. You would be better off removing current monthly arrangements and annual review agreements, especially the ones being deducted from super.
Having said that, the FPA’s comments are not helping. No solution, just grandstanding again.
The FPA CEO pursuant to the AMP Four Corners is reputed to have said “the professional obligations that must be upheld by all financial planners who are members of the FPA are captured in the eight principles of the FPA Code of Ethics.” But he has failed to take the initiative and tell us what action FPA is going to take against those AMP financial planners found of breaking the code. Until we have an industry body willing to take immediate public action against poor/ illegal behaviour of a member, we will never become a profession.
Good of the FPA to take the moral high ground. Too bad they didn’t have the same level of integrity with the adviser they let off the hook as highlighted in the RC. Another hypocritical statement from a reactive organisation that is losing its relevance.
While I don’t condone the AMP’s actions in the past, I would like to point out that the FPA has MANY members associated with AMP. Perhaps they might have made some effort to be balanced in their response and potentially even defend it’s members.
We get enough flack from the media etc without attacking each other from within.
Good on you FPA for covering your own backside and attempting to make yourselves look like the good guys.
We can give every adviser a PHD in ethics and financial planning and it will not change the behaviour of people motivated to do the wrong thing.
But AMP paid for their members fees and gave them a 10% discount. So why would the FPA listen to individual AMP planners?
What a joke FPA were aware of the practice of dealing with orphan clients in more than AMP. They were also aware of these type of organisation schooling its staff on the questions for DFP subjects and having paraplanners do the DFP 8 subject – now they are holier than thou – a little to late
Dante might need to be careful here. The lack of any service to it’s members while pushing it’s own conflicted agenda seems to put the FPA in the exact same position as AMP.
Three Words: “Professional Partner Program”.
Another 3 words: Pot, Kettle, Black.