Stockbrokers urge government to work with industry on new disciplinary system for financial advisers

HAVING developed an effective disciplinary model to monitor and enforce the FASEA Code of Ethics, ready to go on January 1, 2020, Stockbrokers and Financial Advisers Association (SAFAA) and other associations representing financial advisers are disappointed in the timing of the government’s decision to move away from this model at this late stage. 

They are urging the Federal Government to work with them on a new disciplinary system for financial advisers.

Australia’s six leading professional associations for financial advisers have withdrawn their application to have Code Monitoring Australia (CMA) approved as a nation-wide scheme for monitoring and enforcing the FASEA Code of Ethics, due to come into force on January 1, 2020, following the government’s announcement that it will establish a single disciplinary body as recommended by the Financial Services Royal Commission.

“The announcement by the government makes it inappropriate for us to proceed with CMA,” said SAFAA CEO Judith Fox. “We need to avoid adding complexity, further duplication and cost to the regulation of financial advice.

“We question the timing of the government’s decision, which will just prolong the uncertainty for financial advisers and the many thousands of Australians they serve," she said.

“The government needs to deliver a clear and workable solution to enforcing ethical conduct. Any code monitoring body must have a solid understanding of the different streams of financial advice that consumers request. The solution must be delivered as efficiently as possible to minimise costs to consumers.”

About Code Monitoring Australia and the FASEA Code

CMA was established with the joint support of the Financial Planning Association of Australia (FPA), the Association of Financial Advisers (AFA), the Boutique Financial Planners (BFP), the Financial Services Institute of Australasia (FINSIA), the Self-Managed Super Fund Association (SMSF Association), and the Stockbrokers And Financial Advisers Association of Australia (SAFAA). The Corporations Amendment (Professional Standards of Financial Advisers) Act 2017 (Cth) established education, training, and ethical standards for licensed financial advisers in Australia. The Financial Adviser Standards and Ethics Authority (FASEA) has been mandated by the Australian Government to implement these standards including annual continuous professional development and mandatory Code of Ethics requirements.

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