Mark Rantall, chief executive officer of the FPA, said that while the government has taken some of the report’s recommendations on board, it has “more to do” in order to align with the report’s approach.
In particular, Mr Rantall said the FPA does not support the notion that misconduct by financial advisers is the sole reason compensation has been awarded.
“Licensees and also fund management groups are critically important in the process and need to be held to the same account [that] financial planners are,” Mr Rantall told InvestorDaily.
“The problem is that the only, and the easiest, source of compensation for consumers is through the financial adviser.”
In addition, the FPA said it does not support some of the government’s recommendations regarding professional indemnity (PI) insurance, stating increasing PI requirements will not “solve the problem”.
“We believe financial planners are carrying their fair share of the burden … PI premiums have gone up considerably in the last couple of years, and we’d hate to see anything brought into play that could result in [further increases],” Mr Rantall said.
Mr Rantall added the FPA wants to ensure the recommendations don’t disadvantage financial planners who are “already struggling under the burden of introducing the Future of Financial Advice (FOFA) reforms”.
“Financial planners are dealing with a tsunami of regulatory changes at the moment, and we should be able to get that down first before implementing any more changes,” he said.
