Industry urges single source of regulation for advice

In its annual report for the 2020 financial year, the FPA stated that it was “imperative” the Coalition use the introduction of the disciplinary body, slated for mid-2021, to “consolidate the current regulatory framework”.

“A single disciplinary body must streamline regulation,” the association said. 

“This consolidation would not only benefit financial planners by reducing costs and driving efficiencies, but would allow them to potentially offer more affordable advice to more Australians.” 

The FPA suggested the disciplinary body should assume “key functions of ASIC, FASEA, and the TPB as they relate to financial advice, thereby having primary responsibility for government oversight of the conduct of financial planners, setting mandatory professional standards, investigating potential breaches of mandatory standards and law, and applying discipline”.

“A single disciplinary body should be a single source of truth,” the association said. 

“Improving the productivity of financial planning practices and those that regulate them is essential for the continued growth of the profession and the provision of affordable financial advice”.

Lifespan Financial Planning chief executive Eugene Ardino also told ifa the new body should look to limit “duplication and confusion” among advisers about where their responsibilities lay.

“The current regulatory enforcement regime we are under with ASIC holds us to an extremely high standard, as does the FASEA code of ethics, so I don’t know what more a disciplinary body can add to that,” Mr Ardino said.

“What I’d like to see is a limit to any duplication, so if responsibility is going to be put on the disciplinary body for certain things, advisers and licensees shouldn’t answer to different bodies for the same thing. I think that causes confusion and duplication.”

Mr Ardino said if the many regulatory agencies already responsible for parts of the advice industry were not streamlined, it could lead to “unnecessary duplication or having different bodies with different interpretations” of advice law.

“If this body is going to handle disciplinary action, perhaps that needs to be looked at in conjunction with what ASIC is responsible for,” he said.