Calls to add FSG to adviser register to avoid misinformation
Financial Services Guides (FSG) should be included as part of the proposed national register of financial advisers to provide detailed remuneration information and to prevent consumers getting skewed information on advisers from commercially operated websites.
Chan & Naylor Wealth Planning partner David Hasib said the mandatory inclusion of FSGs on the national adviser register being created by the Australian Securities and Investments Commission (ASIC) would address the issue of conflicted remuneration by requiring an adviser's relationship with product providers and their fee schedules to be included on the register.
Hasib said these details are included in every FSG and without its inclusion "we will have an incomplete disclosure platform that may encourage consumers to further their understanding via alternative and easily accessible online resources whose representation of the industry is based on the opinion of peers rather than fact".
He also stated that the inclusion of FSGs would allow advisers to use commissions as a payment model arguing they worked for the benefits of consumers where advice was transparent and clients could make informed choices and a product best fit their needs.
However, for this to take place information about fees, commissions, ownership and product provider affiliation needed to be made publicly available via FSGs on the ASIC register of advisers according to Hasib.
He said Chan & Naylor supported the development of the register which would provide those seeking advice with a better picture of the adviser they may work with and what products may be represented through that relationship.
"Having a consolidated and comprehensive view within a central framework that is controlled by the regulator will enable consumers to make a more informed decision before engaging a particular advisor," Hasib said.
AUTHOR
Jason Spits
Recommended for you
ASIC has released the results of its first adviser exam to be held in 2025, with 241 candidates attempting the test.
Quarterly Wealth Data analysis has uncovered positive improvements in financial adviser numbers compared with losses in the prior corresponding period.
Holding portfolios that are too complex or personalised can be a detractor for acquirers of financial advice firms as they require too much effort to maintain post-acquisition.
As the financial advice profession continues to wait on further DBFO legislation, industry commentators have encouraged advisers to act now in driving practice efficiency.
