FPA acknowledges findings of ASIC report into large institutions



March 20, 2017

The Financial Planning Association of Australia (FPA) acknowledges the findings of ASIC’s
review into how Australia’s largest financial advice firms have dealt with poor advice and noncompliant
financial advisers in the past.
ASIC Report 515 ‘Financial advice: Review of how large institutions oversee their advisers’
concludes that while Australia’s big banks have improved their systems and culture, there is
further work to be done to improve practices.
Commenting on the report, Dante De Gori CFP®, CEO of the FPA, said, “The review indicates a
lot of work has been done by the major financial advice institutions to improve their practices –
but clearly there’s more to be done to ensure consumer trust and confidence is well placed.
“The review highlights repeated failures by the big banks to notify ASIC about breaches of
conduct, delays in reporting problems and inadequate background checking and information
sharing within the industry.
“Both large and small financial advice firms must have internal processes in place that support
the core values of putting the customer first. If breaches do occur, firms must act quickly to
provide a response in the interests of their customers.
“Complying with the code of professional practice is a way to ensure you comply with the law. It
can also be used by licensees to improve advice and improve the audit process.
“The finding that there are inadequate background and reference-checking processes in place
is disappointing, but not surprising. Consumers need to trust that they only consult with
professional financial planners, and poor reference checking is a significant concern.
“We encourage all licensees/employers to follow the FPA’s reference checking requirements in
the code (including the reference checking consent form), when considering employing or
authorising a representative who purports to be a member of the FPA or a former member of
the FPA. The facility involves checking that the person is in fact a member of the FPA and
that all information regarding any current complaints and any past disciplinary proceedings is
“The FPA knows from experience that many licensees/employers do not have a process for
checking with the FPA for names of financial planners that have had disciplinary actions against
them, so we strongly advocate the use of the facility.
“As the regulator, ASIC plays a critical role in consumer protection and we support the findings
of the report. We continue to work proactively with the Government and industry to raise
standards of financial advice for Australian consumers.”

SOURCE: Financial Planning Association of Australia

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Cut & Paste conveys information received directly from the organisations concerned. Statements and releases published here have been selected for their relevance to the financial planning profession. They are generally unedited, and the views expressed do not necessarily reflect those of Professional Planner.

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