Over $25m estimated to be recovered from advice sector

On Thursday (11 November), in its cost recovery implementation statement (CRIS), ASIC said the “decision to cap levies” and with an estimated 18,750 advisers and 2,934 licensees operating, $25.8 million will be recovered for the year.

“Under the industry funding model, all entities in this subsector pay a minimum levy of $1,500, and a graduated levy based on each AFS licensee’s share of the total number of advisers registered on the financial advisers register at the end of the financial year,” ASIC said on Thursday (11 November).

“This is because the greater the number of advisers, the larger the number of clients able to be serviced and the higher the level of regulatory oversight required.

“A licensee will only pay the levy in proportion to the number of days in the financial year that they held the relevant AFS licence authorisation.”

Among the respondents in the CRIS feedback included the Financial Services Council (FSC), the Association of Financial Advisers (AFA), the Financial Planning Association (FPA) and the Stockbrokers and Financial Advisers Association (SAFAA).

In July, it was revealed that costs allocated to the advice sector by ASIC grew by over $16 million to around $72.2 million.

Of the $55 million, $16 million came from enforcement, $8.3 million from supervision and surveillance, and $22 million from indirect costs including governance, property and IT support.

In regard to licensees specifically, estimated levies to recover costs for 2020-21 have also gone up from $2.1 last year to $2.2 million.

ASIC said moving forward it will focus on the conduct of licensees to identify any potential harms “that threaten good investor and consumer outcomes” and remains committed to implementing the financial services royal commission recommendations.

The actual levies are set to be published in December 2021 and invoiced in January 2022.

Neil Griffiths

Neil is the Deputy Editor of the wealth titles, including ifa and InvestorDaily.

Neil is also the host of the ifa show podcast.