ASIC clamps down on realtors
Real estate agents will be regulated under the same regime as financial advisers when offering financial advice to clients.
Real estate agents will be regulated under the same regime as financial advisers when offering financial advice to clients.
This has been the final finding from the Australian Securities and Investments Commission’s (ASIC) review of the financial advising activities of real estate agents.
ASIC has recommended real estate agents be required to inform their clients the advice they provide is of a general nature and to provide information relating to any conflicts of interest with giving the advice.
They should also be required to recommend their clients seek their own advice in relation to the suitability of a proposed investment, it says.
“Real estate agents who give personal recommendations as to the suitability of particular real estate investments by reference to investors’ individual circum-stances and needs should be subject to authorisation requirements, disclosure re-quirements, conduct standards and investor redress mechanisms that are compara-ble to those that are available to retail investors obtaining personal securities rec-ommendations,” the report states.
ASIC’s review findings stem from its original report, which was released last July. Since publishing the interim report, more than 40 submissions have been received by the commission.
ASIC chairman Alan Cameron says it is now up to the various state Governments to implement the findings of the report.
“ASIC is very keen to assist with implementation, including by providing advice about the competencies that agents need to have or acquire in order to give general financial advice,” he says.
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