Are MDAs a product or a form of advice?


Managed accounts should be viewed as a way of implementing advice rather than an investment in their own right, according to the Institute of Managed Account Professionals.
In a submission filed with the Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry, IMAP has argued that managed accounts should be exempt from any prohibition on product manufacturers providing financial advice.
It said it did not support restricting the rights of an appropriately authorised licensee to provide personal financial advice to retail clients in respect of managed accounts with which it, or a related entity might be associated.
The IMAP submission said this was because the advantages of managed accounts represented a material benefit to the clients and because “managed accounts should be viewed as a way of implementing advice rather than an investment in their own right, even though the law considers a managed account as a separate financial product from the underlying investments”.
“To the extent that structural separation is mandated, managed accounts should be exempt because of the benefits they provide clients in the implementation of the advice received,” the submission said.
Recommended for you
The director of Ascent Investment and Coaching, Michael Dunjey, has been charged with 33 criminal offences.
Adviser Ratings’ latest financial landscape report finds there is a demographic of advice practices achieving an average revenue of $5 million, with only 3 per cent of practices overall seeing a revenue decline.
The FAAA is calling for regulators to take a partnership approach with financial advisers regarding incoming legislation, rather than treating the industry as “guinea pigs”.
There have been strong numbers of returning advisers this year so far, according to Wealth Data, already surpassing the same period for 2024.