What has happened to the trust and respect in the Sale of Advice profession?

What has happened to the trust and respect between the contactor, their chosen AFSL and association?

And you thought the gross indecencies uncovered by and to advisors in the Hayne RC and the machinations of altering the valuation of FP practices by a national AFSL was the finish of advisors being sorely and poorly treated?

Think again.

It appears there are new ways to work advisors over being invented by a certain representative group and some AFSL’s

Let’s examine the manner which advisors have been treated by a particular association. As reported by the AIOFP it appears that an advisor is being asked to abide by regulation 18.

‘Relationship with an Approved External Dispute Resolution Scheme

  1. Any reference by a Complainant to an Approved External Complaints Resolution Scheme shall not prevent the Complaint being received or dealt with under this Disciplinary Regulation’.

Peter Johnston, Executive director of the AIOFP reports in a recent email to members, “Member Bill Mills is onto AFCA about going outside of their jurisdiction and this certainly seems another example of it. It will be high on the agenda with the Minister Jones and Deputy AFCA Ombudsman Shail Singh at the Gold Coast conference.”

The member shared with the AIOFP the following response,

“As this document illustrates, the FPA Disciplinary processes is a ‘Kangaroo’ Court where the FPA is only the Judge, Jury and executioner – but also the accuser, complainant, prosecutor and applicant of the ‘complaint’.

The reason I choose not to provide any submissions in my ‘defence’ of the FPA’s ‘Complaint’ was that I didn’t want to dignify the process in defending myself against hollow and vexatious allegations!

I refer to my previous communication where you were notified of the complaint initiated against you by the FPA. In that notification, you were provided with any opportunity to provide a written submission to the FPA by Thursday 13 June 2019. I note that no submission has been provided. Accordingly, the FPA will progress the investigation based on material obtained thus far.

If I’d been found ‘guilty’ of any further punishment other than a request to make an apology, I would / could have had a substantial case against the FPA of damages to my reputation and a lack of due process, natural justice and defamation.

If only their ‘ego’ went one step further and ‘hung’ me! I think they were lucky they pulled up short before doing that! Professional defamation can result is substantial damages! They were playing with fire and bombs!

And the second issue reported to us is that of unreasonable demands placed on advisors wanting to move from one AFSL to another.

Things such as:

  • Demanding payments for run off PI cover (in the tens of thousands of dollars) over 5 even 7 years
  • Taking extraordinary times to complete paperwork releasing advisors
  • Demanding all notes, records and file notes of clients sometimes going back for years, quoting S912A of the Corporations Act

One advisor is contemplating going public with the following:

My other avenue is Social Media to the whole Financial Services community with phrases like:

AFSL’s seems to love their advisers as long as they continue to stay with them. The moment they choose to move on, AFSLs come hard on them making their exit pretty difficult to a point of no return.


AFSLs are holding onto vaguely worded contract terms that allow them to charge anything they like – like PI run-off cover in an effort to handcuff them to stay.

I don’t believe this has anything to do with PI but is a ham-fisted attempt to stop advisers leaving. 

As participants “lawyer up” and rattle their sabres the good that advisors can do is being eroded because they are spending more and more of their time on defensive actions instead of looking after their clients and the ultimate welfare of the nation.

The costs and mental health are dragging advisors away from what they do best, giving advice to Australians.