The Financial Planning Association of Australia (FPA), Association of Financial Advisers (AFA), Boutique Financial Planners (BFP), Financial Services Institute of Australasia (FINSIA), Self Managed Super Fund Association (SMSF Association), and Stockbrokers and Financial Advisers Association (SAFAA) have joined forces to develop an ASIC-compliant code monitoring solution.
We’ve previously discussed how from 1 January 2020, any adviser will be required to comply with a code of ethics and be covered by a scheme “under which their compliance with the code will be monitored and enforced.”
ASIC explained that licensees will need to ensure all authorised representatives must be covered by an ASIC-approved compliance scheme. For advisers who join a licensee before 15 November 2019, the licensee will have until 1 January 2020 to ensure they’re covered.
Following on from that, the FPA lodged an expression of interest to administer a separate legal entity, Code Monitoring Australia (CMA), which would be responsible for enforcement of a compliance scheme for the entire financial planning profession.
Under the new partnership with the five other associations, the CMA-administered scheme will be called the Financial Advisers Monitoring Scheme.
Noting that the partnership demonstrates a commitment to cooperation in lifting the ethical and professional standards of financial advice, FPA chief executive Dante De Gori explained: “his is an important step forward for the financial planning/advice sector that will facilitate recognition as a profession, which has long been sought by our collective members.”
“Being covered by a code monitoring compliance scheme is mandatory,” he added. “All existing financial planners and advisers will be required to subscribe to an approved scheme by 15 November 2019.
“The cooperating associations are united by a joint purpose to ensure that financial planners and advisers can choose to subscribe to a professional associations based scheme, rather than commercial alternatives which may be less suitable or more expensive. This scheme is being developed by the profession for the benefit of the public.”
It’s easy to see the benefits of a compliance scheme that’s standardised across the advice industry – it reduces opportunities for misunderstanding and arguably empowers consumers with a single source of compliance information when seeking financial advice. We’ll keep you posted on what the scheme looks like as it’s developed.
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