FPA backs ASIC product intervention power
The Financial Planning Association (FPA) has signalled it will be supporting the implementation of the Financial System Inquiry (FSI) recommendation that the Australian Securities and Investments Commission (ASIC) be granted greater product intervention powers.
FPA chief executive, Mark Rantall has confirmed to Money Management that the FPA’s response to the FSI final report recommendations would endorse giving the regulator greater product intervention capability in the interests of reducing the level of product failure and therefore lifting consumer protection.
The FSI recommended that the Government should amend the law to provide ASIC with a product intervention power, enabling it to “take a more proactive approach to reducing the risk of significant detriment to consumers with a new power to allow for more timely and targeted intervention”.
Rantall said the FPA agreed with the broad thrust of the recommendation, not least because of the manner in which product failures had impacted the reputations of financial planners.
He suggested that making product manufacturers more responsible was not without precedent in circumstances where superannuation fund trustees had a fiduciary duty to their members.
The Association of Financial Advisers has expressed similar concerns about product failures impacting the reputations of advisers and used a recent submission to a Parliamentary Committee to complain that the advice industry was too often the subject of misattribution of blame.
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