The industry representatives in ASIC’s Financial Services and Credit Panel that will assess adviser breaches have been let go as Treasury recruits a new cohort of peers to kick-start the Single Disciplinary Body era of financial advice.
ASIC wiped the FSCP’s slate clean on July 1, with its 16 members being released well before the Better Advice Bill passed.
Despite the Bill still being out for consultation at the time, the regulator saw the “likely” event of the Bill’s passing necessitating a six-month reset for the FSCP as it would greatly affect its statutory functions and powers.
“In light of these proposed changes, the current structure and operation of the FSCP is likely be superseded on 1 January 2022 and accordingly, ASIC allowed its arrangements with members of the FSCP to expire on 30 June 2021,” ASIC stated. “As a result, from 1 July 2021 there are no members of the FSCP.”
Getting a head-start on re-forming the FSCP was a good call, with the Bill passing last week which leaves Treasury just shy of 10 weeks (including the holiday period) to finalise members before it takes effect in January.
Speaking to Professional Planner on the Bill’s passing last Friday, financial services minister Jane Hume confirmed Treasury’s FSCP member drive is already underway.
“We’ve already started looking into that,” Hume said, referring to new member appointments. “It will be done over the next couple of months, we’ll be making sure we have the right number of people to draw on for the panels.”
Individuals can self-nominate for inclusion on the FSCP’s ‘pool’ of members, a Treasury representative confirmed.
The industry associations are also being roped in to lend a hand.
“The Minister, via Treasury, has given professional associations an opportunity to nominate potential candidates for the Minister to consider for the ‘pool’,” the Treasury representative told this publication.
How many members Treasury will want on the FSCP is one of the unanswered questions about the new Single Disiplinary Body’s operations. The panel started in 2017 with 18 members and finished in July with 16, but this number may swell given the FSCP’s expanded role which now includes policing the Code of Ethics.
(For the record, the 16 incumbents are: Annette Spencer, Brad Fox, Bruce Debenham, Calvert Duffy, Cherie Feher, Christine McArthur, Dacian Moses, Don Crenlin, Gabrielle Bouffler, Gaye Simpson, Gayle Cilfone, Jennifer Diggle, Joanne Turner, Naomi Layton, Peter Wade and Stephen Cavanagh.)
According to the Bill eligible persons for the new FSCP could include “representatives from the financial services industry, such as financial advisers and financial services licensees, as well as people with experience in other fields, such as law, economics, accounting and tax”.
It’s unknown at this point how many of the legacy FSCP pool members, if any, will be re-instated.
Given the FSCP’s new role, it’s possible Treasury could source panel members with different backgrounds. Those with experience in ethics development, for example, may be on the desired list.
A whole new game
The FSCP’s expanded role probably also changes the time commitment expected of members. Finding an expanded list of professionals with the requisite experience who also have several hours a week to spare could be problematic.
According to Treasury, gauging how many hours FSCP members will need to sacrifice is tricky but will vary according to the volume of work, which remains to be seen, as well as the skillset and experience of particular members.
“The time commitment of individuals appointed to the pool will depend on the number of matters that are referred to [the panel],” a Treasury representative stated. “As [FSCP] panels will be convened with members whose experience and knowledge align with the matters being considered, it is difficult to predict the time commitment expected of each pool member.”
The nature of FSCP appointments is also a consideration. The 16 incumbents are all relatively low-profile figures, except perhaps Brad Fox who led the Association of Financial Advisers between 2012 and 2015. The legacy group is mostly comprised of respected and experienced advisers, with a couple of consultants and industry executives thrown in.
It would be out of character for Treasury to deviate from this low-profile cohort of stalwarts, but it may end up being forced to pick more visible industry figures.