The Forgotten

Dear Parliamentarian, there is little doubt this Government has had an Agenda to eliminate Financial Advisers from the landscape to assist Institutional backers in their quest to install digital advice since the appointment of current Treasurer Frydenberg as our Minister in 2014.

Despite Commissioner Hayne exposing poor Institutional behaviour and facilitating their unexpected but welcomed departure from advice, the recent admission by newly Government appointed Quality of Advice Review ‘expert’ Michelle Levy neglects the forgotten people of our industry.

Ms Levy admits her agenda is to find an Advice pathway back for the Institutions by reactivating their original digital advice objective. Digital advice is just another version of the profoundly conflicted vertical integration concept without humans involved, it is essentially just a software system designed to ‘flog their own product’ to customers.

The ‘forgotten’ are the estimated 12,000 humans who have been already intimidated out of the industry by the draconian FASEA/LIF Legislation with another 3,000 predicted to leave over the next 12 months primarily due to the ‘kill adviser’ theme of the FASEA Exam. The one size fits all Exam approach is peppered with ambiguity and trickery designed to trip up thousands of experienced older Advisers, it is a disgrace and has caused a mental health and suicide crisis in the industry.

There are 2 critical issues we encourage this Government to take into consideration before the election –

  • Unless they want to see up to 3,000 experienced predominately Risk Advisers depart the industry by the September FASEA Exam dead – line, they commit to revamping the entire Exam format by suspending the deadline for at least 6 months and allow Advisers to service their clients if re-elected.

The December 2022 time – line for the Ms Levy’s Report is an automatic death sentence for the September 2022 deadline Exam victims. What happens if Ms Levy recommends that Risk Advisers should be treated differently to Financial/Investment/Stock Broker Advisers in her December Report?

  • What this Government needs to understand is Risk Advisers service a specialized cohort of consumers who the more sophisticated Financial Adviser do not want as clients. They charge minimal fees to ensure these consumers keep paying their family protection policies and assist with claims, duties the Insurance companies are not geared to do.
  • Furthermore, we understand the nations underinsurance problem has escalated to well over $2.2 trillion from $1.75 trillion 5 years ago, a national crisis for Tax payers future welfare liabilities. This disaster is directly related to the Governments handling of the Advice industry.

It is about time this Government acknowledged the honourable duty to tax – payers by admitting their past poor handling of the Advice industry and demonstrate the willingness to do something about it THIS SIDE of the election.

Anything less will be viewed with a high level of suspicion by the Advice community and their 4 million clients who are literally paying for this Governments inept performance.


Peter Johnston | Executive Director
Association of Independently Owned Financial Professionals
Suite 1211, 1 Queens Road, Melbourne VIC 3004
P 1800 111 203, d 03 9863 7574, m 0418 857 621 | Download my business card

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