Call for appropriate aligned and non-aligned definitions
There needs to be greater transparency for consumers with respect to whether the advice they are receiving from financial planners is either aligned or non-aligned, according to specialist financial planning business broker Paul Tynan.
Tynan argues that it should be the case that 'aligned advice’ “is where the adviser is in a salaried position and licensed via a bank, industry fund etc. There is a restriction of ownership of client and buyer of last resort (BOLR) terms in place”.
He said that, by comparison, 'non-aligned advice’ “is where the adviser is a self-employed business owner and there is no restriction with respect to client ownership, and if the adviser wishes to leave a licensee the clients are clearly transferable”.
Tynan argues that much of the heat in the debate around the Future of Financial Advice (FOFA) changes has been owed to a failure to appropriately identify and distinguish the competing interests in the financial planning industry.
“In my opinion, it’s not Government that’s the cause of the problems and complaints that have been directed towards FOFA but the overabundance of self-interest groups lobbying intensely to ensure that the interests of their particular sector, company or association are met - even if above those of the industry or consumer.
“In the end, there’s no point pointing the finger of blame at Government and the legislators when the other fingers on the accusing hand are pointing directly back at the real cause and root of all the problems - the industry itself,” he said.
Recommended for you
Results are out for the latest sitting of the ASIC financial advice exam, with the pass rate falling for the second consecutive sitting.
Adviser losses for the end of June have come in 143 per cent higher than the same period last year, and bring the total June loss to over 350.
ASIC’s enforcement action is having an active start to the new financial year, banning a former Queensland financial adviser for 10 years in relation to fees for no service conduct.
ASIC has confirmed the industry funding levy for the 2024–25 financial year, and how much licensees can expect to pay.
