The start of the year was the main deadline for the industry to have passed the FASEA exam with advisers unable to pass the exam required to cease giving advice by the end of January.
The end of 2021 saw FASEA officially closed for business, but an announcement from then opposition financial services minister Stephen Jones kept professional standards in the frame at the start of 2022.
At a conference in December, Jones proposed an experience pathway allowing advisers with 10 years of experience an exemption from current legislation.
Seemingly caught on the back foot, then financial services minster Jane Hume announced a consult into a carve-out for advisers with a decade experience.
After years of seemingly endless discourse about the FASEA exam deadline dominated by the noisy minority, the majority had a chance to speak up and they had to because their profession was at stake.
Plenty of advisers were upset with the move, arguing it was a step back for professionalism. While the proposal had plenty of defenders and alternative proposals that sought compromise and balance, Hume never landed on a specific policy, leaving it until after the election.
“By carving out yet another loophole to allow uncommitted advisers to keep operating, we are just kicking the can down the road,” Melbourne adviser Jordan Vaka tells Professional Planner.
“What use is it to maintain ‘supply’ when the cost of doing so is compromising on fundamental standards? This only benefits a small number of advisers who didn’t want to play by the rules, not the majority who’ve done the work.”
Both ministers argued the carve-out would not water down professionalism.
Overshadowed by the headline announcement of the experience exemption, the consultation also included was changes to the barriers to entry for new entrants.
FASEA-approved degrees could become broader, with the caveat that professional year entrants were required to undertake AQF8 level study – a graduate diploma or certificate.
“With the proposal to move away from FASEA-approved undergraduate degrees to a requirement for a degree that includes eight subjects in the nominated relevant fields, the new advisers who might qualify to enter the profession of financial advice, would be doing this with significantly less specific financial advice knowledge,” AFA’s Phil Anderson said.
However, it was during the middle of the month that would set the tone for the rest of the year with Dixon Advisory entering voluntary administration due to “mounting actual and potential liabilities mean it is likely to become insolvent at some future time”.
Those liabilities arose from a class action regarding conflicted financial advice as well as claims being determined by the complaints authority and the corporate regulator.
Jones described Dixon Advisory as committing “every sin in the book”.
“Conflicted advice, poor capital deployment, over capitalizing and concentration in certain products… just about every disaster combined,” Jones said.
The shadow minister had earlier described his discomfort with any vertically integrated model returning to the industry, singling out industry funds with strong ties to his side of the political aisle.
