OZschwitz authorities gave consumers a false sense of security about professionalism, protection when seeking financial advice

The authorities have given consumers a false sense of security about the professionalism and protection they can expect when seeking financial advice. Most advisers do the right thing by their clients. However, the entry bar to financial planning is extremely low.

OZschwitz authorities gave consumers a false sense of security about professionalism, protection when seeking financial advice 1404435919390.jpg-620x349

OZschwitz authorities gave consumers a false sense of security about professionalism, protection when seeking financial advice 1404435919390.jpg-620x349

There is also no getting around the fact that many advisers are working in environments pervaded by aggressive sales cultures. Exhibit A, of course, is the Commonwealth Bank, Australia’s largest financial institution.

As a consequence of a report of the Senate committee looking into the financial planning at the bank and role the regulator released in late June, the bank was forced to re-open its compensation program to the victims of shoddy advice. However, for those seeking quality advice, it is the strong criticisms levelled at the Australian Securities and Investments Commission (ASIC) by the committee that will be equally worrying.

The committee said the regulator is not tough enough. And without a credible deterrent there can be little surprise that institutions are going to push the boundaries, if not break them, as has been alleged to have occurred at the Commonwealth Bank, in order to grow their profits and reward their shareholders. The committee has really showed that ASIC, at least with respect to financial planning, is a toothless tiger.

http://www.smh.com.au/money/planning/financial-advice-seekers-are-out-on-their-own-20140704-zsuaq.html

OZschwitz authorities gave consumers a false sense of security about professionalism, protection when seeking financial advice

OZschwitz authorities gave consumers a false sense of security about professionalism, protection when seeking financial advice

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