It seems that 2 schools of thoughts are emerging:

1. "Financial Planning" - sales people, cannot be professionals, cannot be independent, should not provide advice, sell products of banks, industry funds, insurance companies, no soft dollars - ok to receive commissions and rebates, with full disclosure

2. "Financial Advisers" - professionals providing un-biased advice, must be independent, not aligned, banks / institutions cannot be shareholders, fee-for-service only, no commissions, no rebates, no soft dollars & full disclosure on fees.

From a "client's perspective" if they seek professional advice, then they expect that advice to be "free from bias" & "independent". The value is in the advice itself and a professional cannot put themselves in a position where an actual or perceived conflict of interest may or may not arise? this is a fundamental principle of a profession. A professional cannot put themselves in a position where they might be influenced or persuaded to recommend a product that pays a higher commission, a fund manager pays a higher % of FUM or a platform provider paying a bigger rebate.

Is there room for both options? E.g. some Dealer Groups still claim to be "100% Fee-for-Service" but charge of "% of FUM" and receive platform rebates, yet claim to be independent. As a client this is absolutely misleading & deceptive and even contrary to FPA Code of Conduct and ASIC guidelines. Have these Directors also forgotten about the Trade Practices Act? The industry really must forget about how the industry currently works, get back to basics & define how clients expect it should work for the benefit of all concerned.

Clients deserve good outcomes and professionals deserve to be fairly paid for work and the advice they provide...just like EVERY other Profession. Perhaps Dealer Groups and Financial Advisers that don't acknowledge this...don't deserve to exist.

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