In May, Association of Independently Owned Financial Professionals (AIOFP) executive director Peter Johnston alleged that Australian Securities and Investments Commission (ASIC) senior executive leader – superannuation and life insurance, Jane Eccleston, had made “erroneous” statements about advisers taking money from clients’ accounts.
Responding to a question on notice regarding the matter from Liberal senator Andrew Bragg during Senate estimates, ASIC said it “rejects the characterisation of statements made by Ms Eccleston at a roundtable to discuss the government’s financial advice reform”.
The regulator included a letter to Johnston from chief executive Greg Yanco, who at the time was executive director regulation and supervision, in which he labelled the allegations “false, misleading and derogatory”.
The rest of the letter, titled “statements you have made about ASIC and its staff”, is below:
ASIC does not accept your characterisation of Ms Eccleston’s statements. Ms Eccleston’s statements were clearly referring to a broader historical context being the findings of the Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry (Royal Commission) in respect of misconduct by financial advisers (including instances of advisers having charged their clients ongoing fees for services that were not provided) and the subsequent legislative reform introduced to address this historical misconduct. Ms Eccleston’s statements could not reasonably be understood or properly characterised as an “attempt to smear the advice community in front of all other stakeholder”.
We note that your statements of concern have been re-published by the Independent Financial Adviser seemingly as a result of steps you have taken to circulate your statements to the media. ASIC considers it inappropriate for you to have taken this step when your statements are clearly false, misleading and derogatory.
We note that ASIC has previously raised its concern about statements you circulated to the AlOFP’s members attributing the suicide of a financial adviser to their failure to pass the financial adviser exam. Following our enquiries which verified that there was no evidence to substantiate your claim, ASIC raised with you its concern with the accuracy of your statements.
ASIC values its engagement with industry associations who play a key role in providing a voice for businesses within the industry.
However, in the circumstances outlined above we have reason to be concerned about the appropriateness of your engagement with ASIC officials and the accuracy of your reporting that engagement. Accordingly, ASIC intends that all future communications with you will be in the form of written correspondence only. I ask that you direct your written correspondence to me rather than other ASIC officials. I will ensure that your correspondence is directed to the appropriate ASIC official for consideration and response.
The letter was also sent to Financial Services Minister Stephen Jones.
ASIC also included the response that Johnston sent to Yanco’s letter, in which he stood by his understanding of the Eccleston’s comments and the issue of adviser suicides.
“In regard to the circa 30 suicides in our industry and the one specifically over the exam, we sought permission from the family at the time and they declined the opportunity to allow public scrutiny around the circumstances,” Johnston said.
“We will have to agree to disagree over what Ms Eccleston said, you were not there, I and many others were including the Minister.
“Any reference to ‘Advisers’ taking money out of consumers bank/super accounts without permission whether in the Royal Commission context or not is incorrect.”
Extremely proud of Peter Johnson. Every adviser should be with AIOFP. Why? the fact ASIC has taken umbrage is a telling sign to me that our body is holding them to account , and making them feel so umcomfortable that they will only communicate via email. It would be funny if this was a soap opera however it is not, it is peoples livlihoods that ASIC have in their incompetent hands.
What it really means is that the Government and all related bodies are no longer taking any notice of the AIOFP.
Really? Well, let them – AIOFP can then hold them to account for not listening. Either way – a good result I should think. Keep up the pressure AIOFP.
ASIC, like most public service types do not take kindly to criticism…especially when it is valid.
So the FAAA were there and did nothing nor supported their fellow representative body? P**s weak
If ASIC wanted to do something positive for consumers, they would immediately support the new legislation passed by Parliament more than a month ago, by taking a no action position with regard to scrapping FDS’s, anniversary date flexibility and the allowance of consent to be given up to 60 days prior to the anniversary and up to 150 days after. This would immediately free up our time so we can help more Australians to plan for their retirement, and maybe save a few from unlicensed shonks and scams. But instead of doing this, they are engaging in this childish tit-for-tat nonsense. Grow up and get your priorities right ASIC!
All the talk about ‘quick wins’
The easiest and most significant of which would be the immediate removal of FDS obligations. As Michelle Levy said, the fees are well disclosed to clients – in the FDS, SOA and product statements and do not need to be replicated.
As if the time from recommendations to legislation wasn’t long enough, the legislation itself adds additional requirements as we transition away from the FDS regime.
What am I missing? I cannot understand why no-one is screaming from roof-tops about this!
Only missing point is why more read tape – who keeps doing it and why?
Becoming a little over sensitive to any form of criticism it seems ASIC ?
Andrew Bragg having a crack, AIOFP having a crack, the media having a crack and the vast majority of Advisers across the country hold you in a never ending state of disrespect and contempt.
ASIC is a failed entity prone to self protection and self promotion in the pursuit of holding on to over paid and protected positions of power.
Goodbye, time to start again.
Remember what a very recent Senate Committee reported about ASIC?
“Rather than engaging with the committee in a transparent and accountable manner, from the outset ASIC has chosen to attempt to undermine and influence the process of the inquiry before evidence had been gathered or hearings held,”
I wouldn’t be surprised if Misha Schubert gets appointed as an ASIC commissioner in future, especially if Albanese gets re-elected next year.
I think more planners should be AIOFP members. They have been strong advocates for the industry for years and willing to call out this shameful behaviour when other associations tend to look the other way to maintain ‘good working relationships’ only to be ignored anyway when it counts.
On my way to joining AOIFP
‘ASIC values its engagement with industry associations’. Ha ha ha ha ha! This is almost as false and misleading as their best buddies’ ‘compare the pair’ ads, or the labelling of industry fund investment options as ‘Balanced’, which ASIC has ignored for decades. However bringing adviser suicides into the conversation is quite poor. We all know that ASIC’s relentless persecution of our profession with draconian, retrospective application of new interpretations of legislation has caused enormous harm to advisers and their families, including suicides. To deny this just demonstrates once again how heartless and morally bankrupt the organisation is.
you forgot to add “and sadistic”
But then ASIC release their timely report right at them time s99FA was trying to be pushed through parliament. Just a coincidence I am sure…. Why was Eccleston even making comments about historical events and under the impression the fee for no service is still a prevalent issue today? Seems like a rather odd comment for her to make out of nowhere. Of course if she is coming from a personal ideology and workplace culture that despises advisers, then I guess you would expect that kind of comment at an opportune time.
And NOONE Mentions Report 639 where industry fund super and scaled super advice failed to meet best interests in over half the time and over 30% left clients in a detrimental position. Why does no one mention this report??
Follow the money?
While I generally have a lot of respect for ASIC (and none for Jones and his bureaucrat mates), it should only be relevant whether Mrs Eccleston made such comments or not. If she did, it is absolutely disgraceful and Mr Johnston should be exposing it. If she didn’t, then ASIC is right to be concerned. On the balance of what I’m reading, and with particular emphasis on ASIC’s concession that “Ms Eccleston’s statements were clearly referring to a broader historical context being the findings of…” I believe the evidence is stronger on the side of Mr Johnston. I’m very much looking forward to the outcome of the National Anti-Corruption Commission investigation.
I also would like to know how they investigated the suicide. I’m fairly certain if the family believed it was linked to him/her failing the flawed financial planning exam then they wouldn’t have discussed the matter with ASIC if they reached out.
Are you serious? You said, You have a lot of respect for ASIC. You sound like a FAAA employee getting consulting fees in the background. No serious person involved in the financial services industry would seriously think ASIC are doing a great job. Did you miss the memo about the billions lost to scammers, or the complexity and bad legislation….oh wait you have a job in Compliance and business is booming….fair enough.
ASIC needs to be ripped to shreds.
I’ve been saying for a long time that Peter Johnston and the AIOFP are doing more harm than good. Harping on about reinstating grandfathered commissions, lobbying Advisers to push their clients into their own political agendas. This statement from ASIC confirms they view the AIOFP as a radical group who they don’t pay any attention to. Anybody who’s a member of the association may as well tear up their membership….they’re now irrelevant.
You are pointing the gun at the wrong person; ASIC has shown time and time again that they are a bumbling, incompetent Government organisation that even came out in the RC. They don’t like it when someone pushes back; all credos should go to Peter Johnson and the AIOP for their stance.
The only thing they are achieving is getting the Government, ASIC, Treasury etc. offside. They’re not going to achieve anything for our industry. As soon as Peter mentions grandfathered commissions, which is basically every sentence that comes out of his mouth, everybody rolls their eyes and disregards anything else he says. Last election we needed lobby the Labour party, now we need to lobby the Libs, who next…the Greens. None of it does anything other than split the industry and make us all weaker when it comes to negotiating decent outcomes. At least the FAAA now has size and has a professional approach to their submissions.
And how is it all going with the FAAA?
I gather you are an FAAA committee member? if so you are conflicted …ouch 🙂
I am a member, not a committee member, and only as a hangover from an old AFA membership which I only had for TPB purposes. What I am saying is that there should be only one association that speaks on behalf of us all. Everyone gets all excited because Peter J. gets his name in the news with his grandstanding, but the fact remains, the association has never achieved anything for our industry other than disunity. The FAAA are not much better as far as outcomes go, but they have membership numbers to back them as the leading association.
Move to AIOFP – problem solved.
You no longer need to be a member to hold TPB status. Just quit. The FAAA have done and do nothing for Financial Advisers. They’re interests lie in looking after Super funds and before that large insto’s. You do know a former board director was getting consulting fees from ASIC don’t you. Hardly going to speak up for you are they now.
Professional approach to submissions – well, that changes everything right?
So how would you classify the statement in question here made by ASIC’s Jane Eccleston – professional?
“At least the FAAA now has size and has a professional approach to their submissions.” The FAAA was once called the FPA – it had size and money in the bank – it lost loads of members doing that same same “professional approach to their submissions”. Keep doing the same thing and expecting a different result is IMO a waste of time and effort – not even sure the FAAA has real Financial Planners interests as a priority?
Everyone that has been around for a while knows that our associations have been gutless for years, look at the track records, the AIOFP is actually saying what we all think for once.
Why do you think the unions are so powerful in terms of government lobbying? As they sit in the corner and whimper when its all too hard, or they play nice with people who have no respect for them? No they come out swinging. Its time we did too.
Stuff asic,stuff treasury, these people are there to feather their own nests, not help us. So why would be be nice to them?
It dosen’t work and never has!
“ASIC does not accept your characterisation of Ms Eccleston’s statements.”
Seems clear ASIC is admitting Ms Eccleston said it – just trying to spin it to issues from the past – why she is still referencing things from 2018 is potentially very concerning and potentially points to cultural issues against Financial Planners within ASIC?
Show us the tape.
I don’t know sounds like AIOFP has gotten right under ASIC skin, and irrelevant compared to whom? FAAA haven’t they been a powerhouse lobby on our behalf!! Not!
Really, maybe ASIC are trying to smear the AIOFP and Peter because of the heat being applied for the Dodgy Dixon’s MIS Fiasco and the Corrupt CSLR.
Thus ASIC now 3 mths after this meeting and comments are whinging about the AIOFP and Peter.
Seems to me ASIC continue to obfuscate Senate Questions and avoid any real scrutiny.
FYI – ASIC is a Government body that needs to be held accountable to the Australian Tax Payers and Advisers that pay them.
Anything less than full disclosure for both matters from ASIC reeks of more secretive hiding the facts.
WELL SAID!
…a lot of the AIOFP have been hanging on to the old world for far too long and have now become the ‘uncle’ you have to see once a year at family events… Come on guys, the world of selling insurance for 120% comms is gone and industry has evolved well past this, let it go… if we really want a profession then surely you see that your mudslinging is holding the rest of us back too?
Someone else is holding you back? Seriously?
A lot of us haven’t either….And your reference to insurance commissions has what relevance to this article?
Lif should be reinstated by the way, look at the UK – only thing which aided risk advice being returned to pre-commission less levels. It bastardises the risk pool massively otherwise and demonstrate you are a rube.
Now we live in a world where no one sells insurance and “professional” planners scope it out of their service as its too hard and not profitable. So we have underinsurance skyrocketing, but awesome that no one is getting 120% commissions!
You may see yourself as superior, but they have had more traction than our “professional” bodies that have achieved nought on our behalf. We can call ourselves professional, but the pedantic, childish compliance we are still required to do, despite taking on increased education requirements and other requests indicates that we are not a profession and are not allowed to be. I would say the attitude “of maintaining a working relationship” has held us back more than AIOFP. I’m not a member of AIOFP and don’t intend to be, not do I do insurance, but the attitude of being superior to those older advisers who specialised in insurance is poor form.
That is a might high horse you have there sir!
ps. The insurance industry is doing great since commissions were reduced, isn’t it?
Probably very high – and from that height it can be difficult to see what is happening on the ground?
It’s only natural that a section of any persecuted community will gravitate towards a lone voice that challenges its oppressor…history is full of such examples!
Surely there is a recording of the round table or a video of it ?
Let’s hear and or see it ASIC
Arrogant
Secretive
Incompetent &
Corrupt