ASIC acknowledges gaps in robo-advice compliance
The Australian Securities and Investments Commission (ASIC) has confirmed its support for robo-advice even though it acknowledges substantial regulatory issues are yet to be resolved.
ASIC chairman, Greg Medcraft has told a FINSIA forum in Sydney today that the regulator sees robo-advice as having the potential to offer a convenient, low-cost advice service to consumers, and to also deliver benefits such as improved compliance and record keeping.
Medcraft also claimed that robo-advice had the potential to reduce conflicts of interest.
However, he acknowledged that the provision of robo-advice raised interesting regulatory issues and challenges including how robo-advice providers could comply with best interests duty and the training and competency of those sitting behind the robo-advice model.
Medcraft also acknowledged that unanswered questions remained about whether robo-advice providers could adequately compensate consumers for poor advice.
He said ASIC had set up an internal Robo-advice Taskforce to look at robo-advice issues, and was discussing the issues with robo-advice providers and those looking to join the space.
Recommended for you
The Governance Institute has said ASIC’s governance arrangements are no longer “fit for purpose” in a time when financial markets are quickly innovating and cyber crime becomes a threat.
Compliance professionals working in financial services are facing burnout risk as higher workloads, coupled with the ever-changing regulation, place notable strain on staff.
The Senate economics legislation committee has recommended Schedule 1 of the Delivering Better Financial Outcomes legislation be passed as it is a “faithful implementation” of the recommendations.
Treasurer Jim Chalmers has handed down his third budget, outlining the government’s macroeconomic forecasts and changes to superannuation.
