FASEA contradicting ASIC on ‘career break’ pathway
The Financial Adviser Standards and Ethics Authority (FASEA) has muddied the water for financial advisers as what it has said about ‘alternative’ pathways for advisers who do not pass the exam this year contradicts guidance from the corporate regulator, according to an association.
Speaking to Money Management, the Stockbrokers and Financial Advisers Association (SAFAA) chief executive, Judith Fox, said she could not see how the ‘career break’ pathway which FASEA had confirmed would work.
Fox pointed to ASIC guidance which said it would unlikely grant relief on the professional standards for reasons such as taking a career break, taking a break due to health-related issues, or employed in another role or occupation.
“I look at that guidance from the regulator, and I look at the legislative requirements which say once you’re off the Financial Adviser Register (FAR) you have to come back as a new entrant, and we’ve heard from the minister just recently that advisers have to pass the exam this year to provide advice next year,” Fox said.
“So, I just can’t see how that [career break] option applies. Ultimately, we need clarification from FASEA.”
Fox said her members were “unbelievably confused” and that this level of confusion was not needed given there were only three exams left.
“Our concern is that this entire discussion, which was raised by FASEA, muddies the water for advisers at a critical time because there are only three exam sittings left and we’re encouraging all advisers to sit the exam,” she said.
“FASEA’s comments have created extreme confusion and have potentially given false hope to people that think they’ve got another opportunity next year. FASEA needs to give clarification.”
The guidance from ASIC on relief from the professional standards said: “ASIC can grant exemptions from or modifications to the law in certain situations. You can apply to ASIC for relief from the Corporations Act.
“ASIC will generally not grant relief that would reverse the usual and intended effect of these reforms. The intent of the professional standards reforms is to raise education, training and ethical standards of the financial advice industry. Given this intent, ASIC is unlikely to grant relief to a person who was not able to meet the ‘existing provider’ definition because they were, for example:
- Taking a career break;
- Taking a break due to health-related issues; or
- Employed in another role or occupation;
during the period specified in the definition.”
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.
