Eye opening, or scare tactics?
Financialplanners across Australia watched in horror as the mainstream media opened fire on the industry in the wake of the ACA/ASIC shadow shopping survey, alarming many existing clients and scaring off a number of new prospects.
But what effect did the report, and the reporting of it, really have on clients? Some planners say the survey reinforced their good relationship with clients, others say it had no effect, but for many more clients, the report was a catalyst for complaints.
Alison Maynard from the Financial Industry Complaints Service (FICS) says there were more complaints about financial planners during 2003 than 2002, and that this could be attributed to the release of the report.
“The survey did prompt people to think about the advice they got, and in many cases to contact FICS,” Maynard says.
According to Maynard, the majority of complaints about financial planning in 2003 were regarding inappropriate advice and poor service.
The complaints were more concentrated in the first half of the year — when the report was released. But the report cannot be entirely blamed, as Maynard notes that the volume of complaints made to FICS also depends on market performance, as more people examine the quality of advice they receive when returns are down.
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