ASIC backs further scaled advice take-up

In a recent webinar for the FPA’s Virtual Congress, ASIC commissioner Danielle Press said the regulator had “started a number of conversations” with licensees and industry representatives around the possibility of releasing a template SOA to provide better guidance around what compliant scaled advice would look like.

“Obviously that is difficult because things are going to turn on the facts of the situation, but I think for us to say our guidance is clear just because we think it’s clear is the wrong answer, because clearly the industry doesn’t think it’s clear,” Ms Press said.

She added that there was “hesitation to give scaled advice” across the industry, and that ASIC wanted to work with licensees to give them more confidence rather than restricting advisers from delivering important services to consumers.

“We don’t think the guidance stops you giving scaled advice,” Ms Press said.

“Some licensees don’t like it and think the risks are too great and go back to an interpretation of the law, so that’s where we need to take a step back and say what is it that we’ve said in the way we interpret this that’s getting in the way, because our position is that scaled advice is generally the right thing.

“So how do we make sure that industry feels safe enough to execute on that and not have this need to take it another 25 per cent on top of what the regulator has said just to make sure they’re not going to be in trouble.

“Obviously it's a matter for each licensee as to where they want to place that bar, but what we don’t want is that bar to be placed so high that the advice industry collapses under the weight of regulation.”

Ms Press said recent SOA relief around early super advice was providing a “test case” to ASIC around further red tape reduction in the advice space.

“We are looking at what the outcome of that has been – have we seen that relief providing equally as good advice to clients, equally good outcomes, and if they have, what does that mean for our regulatory setting and potentially law change?” she said.

“This has been a really interesting test case for us and we will be looking closely at some of the advice that has been given under some of that relief so we can have some data to say ‘actually we can do this differently going forward’.”