AFCA reveals approach to Code of Ethics compliance

The Australian Financial Conduct Authority has outlined its approach to assessing financial planner conduct in relation to the Code of Ethics.

Speaking at the FPA Congress, AFCA deputy chief ombudsman June Smith said the body will take a measured and considered approach to interpreting the code's provisions, only assessing adviser conduct against the code where the conduct has occurred after 1 January 2020.

AFCA will assess adviser conduct by giving the code its practical meaning, she said.

This means taking into account the intention and objectives of the code as a whole and the professional standards framework from which it is derived; the current legislative, regulatory and professional environment within which the code operates and; FASEA's guidance on the operation of the code.

It will also account for ASIC's expectations about steps licensees should take to ensure their advisers comply, specifically the guidance that they take a facilitated compliance approach with respect to complying with Standards 3 and 7 as FASEA continues to refine its guidance until a single disciplinary body is established.

The code attempts to improve adviser conduct and ensure they place their clients' interests first and that they act in a way that is consistent with the values and standards expected of a member of a profession, Smith said.

"Fairness underpins everything we do at AFCA. In assessing what is a fair resolution of any complaint, AFCA will assess whether the financial firm and its adviser have reasonably met that standard, being mindful that the interpretation of the standard is still being refined via consultation and ongoing rounds of guidance," Smith said.

"AFCA will continue to use its panel of financial advisers and consumer advocates to assist it in assessing whether financial advisers have met the standards of conduct expected of them by the community and under the code."?

Read more: AFCACode of EthicsAustralian Financial Conduct AuthorityFASEAJune SmithASICFairnessFPA Congress
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