Financial Standard Comments - ASIC looks to reshape retail advice

Comment by Trevor ()

Trevor () — Fri, 29 Jul 2011 15:45:26 +1000

Corporations Act Sec 945A embodies holistic advice. That is the law.
Regulatory Guides are "just and only" guides and not prescriptive law.
Therefore Sec 945A needs to be repealed and rewritten so that there is absolutely no misunderstanding as to what constitutes simple, scalable and/or holistic advice and financial product advisers are not put at any unnecessary legal risk.

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Comment by Adam Williams ()

Adam Williams () — Fri, 29 Jul 2011 16:49:57 +1000

I think ASIC has already stated that the language in s945A will be amended so that the reasonable basis test can be explicitly satisfied by scaled advice, but RG200 also addresses the issue, as does CP164, that the suitability requirements are scalable. The risk should be minimal for advice consistent with the RGs. Probably worth making a submission on the matter.

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Comment by Frank ()

Frank () — Fri, 29 Jul 2011 17:49:59 +1000

All advice is scaleable. It's what the adviser determines when meeting the client. In plain English - What is the client asking me to do? or for the compliance people - What are the parameters being set around the advice I am being asked to give. It's called the Scope. All professions use it. Lawyers, Doctors etc.
Until you know the scope you don't know what questions to ask because you don't know what the task is.
The scope is the foundation from which everything else flows naturally. Of course it may take more than one meeting to determine what the scope is because the client himself may not be aware of what's on offer.
Why do we continue to make simple things complex?

Financial Standard Comments - ASIC looks to reshape retail advice

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