ASIC targets misuse of ‘general advice’
Australian Financial Services license (AFSL) holders who misuse the provision of general advice to retail clients will find themselves being scrutinised by the Australian Securities and Investments Commission (ASIC).
The regulator has signalled its intention in its latest Enforcement Outcome Review report where it listed the misuse of general advice as an issue to which it would be paying particular attention over the next six months.
ASIC specifically cited “instances where AFS licensees claim to provide general advice to retail clients during the sale of financial products (and therefore do not need to comply with the best interests duty and related obligations), but are actually providing personal advice”.
Importantly, ASIC said it would also be paying particular attention to financial adviser compliance with the best interests duty and “their obligation to provide appropriate advice to clients.”
ASIC also signalled that it would be continuing the activity which gave rise to its so-called “fee for no service” report, stating that it would examining any failure by AFSLs to deliver ongoing advice services to financial advice customers who are paying fees to receive those services.
Recommended for you
The FSCP has announced its latest verdict, suspending an adviser’s registration for failing to comply with his obligations when providing advice to three clients.
Having sold Madison to Infocus earlier this year, Clime has now set up a new financial advice licensee with eight advisers.
With licensees such as Insignia looking to AI for advice efficiencies, they are being urged to write clear AI policies as soon as possible to prevent a “Wild West” of providers being used by their practices.
Iress has revealed the number of clients per adviser that top advice firms serve, as well as how many client meetings they conduct each week.
