The Australian Securities and Investments Commission (ASIC) recently released a report outlining the areas in which financial advisers working for Australia’s biggest banks “failed to comply with the best interest of customers in 75% of advice files reviewed”, as reported by the Guardian, when comparing approved product lists with in-house products and advice provided.

When you engage a financial adviser, you’re putting your trust in that person to guide you down a path that will accomplish your goals and put you in a better position than before you spoke with them. The adviser should put you and your needs first without the adviser considering their own financial position.

Think of it this way: if a financial adviser recommends a product or service to you, you should know that it’s driven by how appropriate it is for you, not by how much money a financial adviser may make in commission.

The ASIC report found that there were two areas that lead to the reviewed files and advice being classified as “non-compliant,” including the adviser not demonstrating that they had “[…] sufficiently researched and considered the customer’s existing financial products,” and/or “[…] based all judgment on a customer’s relevant circumstances.

 

“There isn’t a one-size fits-all financial advice solution that is appropriate for everyone. We carefully consider many different options and products before making recommendations."
Tim Poole - Head of Financial Advice

 

In order to ensure that we’re operating in the best interest of our members, our planners we begin by asking a lot of questions. “We get to know our clients; their issues, goals and objectives,” says Head of Financial Advice, Tim Poole. “There isn’t a one-size fits-all financial advice solution that is appropriate for everyone. We carefully consider many different options and products before making recommendations. This process isn’t something that’s a carefully-guarded secret; Poole says that all alternative strategies are considered and discussed with the clients by our advisers and are outlined in the Statement of Advice.

The ASIC report also noted an inherent conflict of interest that arises from providing personal financial advice while also selling financial products. One way that we avoid this conflict of interest is to pay our planners a flat wage for providing advice and guidance to our members, regardless of which products they have. Our planners are not paid commission or bonuses for moving you from one product to another. “Our planners are paid a flat wage with no bonus or incentives; recommending different products/ insurers doesn’t impact their remuneration,” says Poole. “This helps us avoid the common conflicts of interest that can occur in our industry.”

 

“Our planners are paid a flat wage with no bonus or incentives; recommending different products/ insurers doesn’t impact their remuneration.This helps us avoid the common conflicts of interest that can occur in our industry.”
Tim Poole - Head of Financial Advice

 

All our planners are qualified and go through a rigorous training and review period, “until we are comfortable with the quality of advice being offered,” says Poole. “Our licensee conducts two audits per year on all Authorised Representatives. On top of ad hoc checks, we formally review several planner files per quarter.” This is all in service to making certain that we are providing the best-quality product.

In 2017 our team was awarded the Industry Financial Services “Team of the Year” award and our Boris Tesanovic was named Financial Planner of the Year – both for the second consecutive year! While we’re not much for bragging, these awards are a testament to the consistent quality of the financial advice services provided by our Financial Planning team.

 

“Our licensee conducts two audits per year on all Authorised Representatives. On top of ad hoc checks, we formally review several planner files per quarter.”
Tim Poole - Head of Financial Advice

 

While it is disappointing to learn that some people haven’t been operating with their customer’s best interests at heart, you can rest assured knowing that we have always – and will continue – looked out for you, as our foremost priority.