Policy Issues

Australian Bureau of Statistics (ABS) recognises financial advice profession

Following FAAA advocacy, the Australian Bureau of Statistics (ABS) has recognised the financial advice profession with in-principle acceptance of our recommendation to use the protected terms ‘Financial Adviser/Financial Planner’ as the principal title of its occupation unit, in proposed changes to the Australian and New Zealand Standard Classification of Occupations (ANZSCO). The ABS has also supported our call to introduce a new classification of Paraplanner as an emerging occupation.    Improving the ANZSCO to better reflect the provisions in the Corporations Act and current roles and practices in the profession is critical as its classification of occupations underpins the data

Read More »

Breach reporting, investigation and compensation

The breach reporting obligations address from the Banking Royal Commission Recommendations 1.6, 2.8, 2.9 and 7.2 (Strengthening breach reporting) and are contained in the Financial sector reform (Hayne Royal Commission Response Act 2020. Non-compliance is a strict liability criminal offence and a civil penalty provision. REPORTABLE SITUATIONS Licensees must report to ASIC within 30 days after it first knows that, or should have known, whether there are reasonable grounds to believe a reportable situation has arisen. Reportable situations are summarised below: Core obligations include: A breach of a licensee’s general obligations, as defined in s912A and 912B Certain sections of the

Read More »

Financial Planning and Technology 

Consumer Data Right  The new Consumer Data Right (CDR) framework was designed to facilitate quick and easy access to data and allows consumers to compare products and services (e.g. financial, telecommunications, energy etc.) in a safe, controlled and convenient environment. The new CDR rules will deliver significant benefits to the advice process by allowing clients to request their financial data be automatically provided by product providers to their financial planner. The Government’s dedicated CDR website provides helpful consumer information and videos financial planners can share with their clients to encourage them to ‘opt-in’ to the CDR system, including:  What it

Read More »

ALRC Review

The Australian Law Reform Commission (ALRC) is undertaking a Review of the Legislative Framework for Corporations and Financial Services Regulation to inquire into the potential simplification of laws that regulate financial services in Australia.  The Terms of Reference set out three key areas for the focus of the Review to be examined through consultation reports:  A first interim report focusing on the appropriate use of definitions in corporations and financial services legislation, released 30 November 2021;  A second interim report focusing on regulatory design and the hierarchy of primary law provisions, regulations, class orders, and standards, is due by 30

Read More »

Legislated professional standards

Overview of requirements The legislated professional standards in the Corporations Act require financial planners to: have an approved qualification pass the financial adviser exam participate in 40 hours of continuing professional development (CPD) each year comply with the Financial Planners and Advisers Code of Ethics 2019 (Code of Ethics). Anyone wanting to become a financial planner must also complete a full-time professional year that includes at least 1,500 hours of work activities and 100 hours of structured training. A single disciplinary body has been established within ASIC to oversee financial planners adherence to legislated professional standards and the law. Further

Read More »

Registration on the Financial Adviser Register (FAR)

The new Single Disciplinary Body will be responsible for overseeing the register for relevant providers, which will be based on the existing Financial Adviser Register (FAR). An annual registration requirement for financial planners will commence on 1 January 2022 and includes a two stage registration process: Stage 1 – licensees are required to register planners with ASIC with details posted on the Financial Adviser Register (FAR). Stage 2 – (once the FAR has been transitioned to the ATO) each financial planner will be individually responsible for registering directly with the ATO. Note: From 1 July 2023, current members who were

Read More »

Single Disciplinary Body

The Financial Sector Reform (Hayne Royal Commission Response—Better Advice) Act 2021 put in place the new Single Disciplinary Body (SDB) within ASIC, extending the existing Financial Services and Credit Panel (FSCP). A FSCP may be convened to:   consider financial planner misconduct and potential breaches of the Corporations Act 2001, including the Legislated Code of Ethics and other legislated professional standards   apply sanctions where appropriate   make recommendations for ASIC to take enforcement action against a financial planner   The Single Disciplinary Body commenced on 1 January 2022, giving the FSCP its own statutory function and powers. The powers of the FSCP include:  

Read More »

Financial elder abuse

Financial elder abuse relates to situations where an older person experiences harm, distress or financial loss occurring within any relationship where there is an expectation of trust. It can also be the result of intentional or unintentional neglect. There is no doubt that financial elder abuse is devastating and harmful to the victims, their family members and friends. It can take many forms. Often one form of financial elder abuse can be an indicator of additional mistreatment. Financial planners are in a unique position to be able to identify financial vulnerability and should be prepared to offer vulnerable clients a

Read More »

ASIC industry funding model

Personal advice levy The model for licensees providing tier 1 personal financial advice (section 43) includes a fixed levy component plus a graduated levy component using the following formula: The minimum levy component is $1,500. You must add to this amount the graduated levy component based on the following formula: Other levies may apply to financial planners It is important to remember that the application of each levy is determined by the authorisations held on your licence and the definition of each section within the Regulations. Hence, in addition to the personal advice levy, you may also incur the following levies:

Read More »