Common regulator needed for entire Financial Services sector
The Australian financial services sector needs a cross-industry level playing field ruled by a common standard of corporate governance, education and just one regulator, according to Chan and Naylor director of financial planning, David Hasib.
In a column to be published in an upcoming edition of Money Management, Hasib argues that in the absence of a single regulator, equal treatment is not being meted out to real estate agents, mortgage providers, the banking sector or self managed superannuation fund (SMSF) providers.
"… there is no recourse on the real estate industry should a $1 million off the plan property investment sours," he said. "This is not the case for financial planners or dealer groups."
"Whereas the Australian Securities and Investments Commission (ASIC) controls dealer groups, planners and manufacturers, who is controlling the real estate agents, mortgage providers, banking sector and SMSF providers?"
Hasib said he believed ASIC should be at the forefront in upholding a widely-recognised standard and code of conduct that provided clear and consistent compliance guidelines for all areas of investment and related advice.
"Having a single set of industry rules with one common outcome will enable the industry to act in the best interests of its clients and achieve the best outcome on their behalf," he said.
Hasib warned that if a common standard was not achieved then the financial services sector risked becoming an even more disjointed environment, allowing the unscrupulous to fly under the radar and prey on vulnerable consumers.
"This will necessarily require ASIC's reactive response to put out spot fires and rule with an iron fist rather than educational agenda," he said. "The question is, how many more Storm Financial or Trio Capital collapses does Australia need before we realise that self-regulation is not working for the common good?"
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