New Declaration of Independence Rules For Financial Advisers
After the Financial Services Royal Commission submission in 2019, many changes have taken place in financial services in Australia. These changes have been put in place to offer more transparency to consumers, and more accountability from the financial services industry. With these changes being rolled out, consumers across Australia, should be able to engage with a financial adviser with more confidence, and information than ever before.
Most recently, ASIC has announced that, as of July 1, advisers must make a “declaration of non-independence” on their financial services guide if they are not independent. By making this declaration, advisers are informing their clients of any affiliations or commissions they receive from product providers such as insurance companies.
Only financial planners who can meet a rigorous set of standards set out under Section 923A of the Corporations Act can describe themselves as independent. ASIC has stated “our position is that words such as 'independently owned', 'non-aligned' and 'non-institutionally owned', and other similar words or expressions, can be used only if a financial adviser satisfies the conditions of Independence set out in s923A.”
This means that for all advisers not giving TRULY independent advice, they must declare so to their clients and prospective future clients. Anyone who receives any form of commission or sales incentive cannot call themselves independent. Similarly if ownership or control exists with a financial product provider then the term independent cannot be used. There are only a very small number of financial planners or financial advisers in Australia who meet the definition of independent.
At Tupicoffs, we are proudly truly Independent Financial Advisors. We don't use the term 'independent" lightly. All our financial planners have signed our Declaration of Independence and confirm annually they meet all the criteria to be called independent. Independence is an important part of who we are and what we do. Moving forward, we will include a Declaration of Independence in our Financial Services Guide. Every decision, every recommendation, every conversation we have, is focused on making a meaningful positive difference for our clients with truly independent advice. This focus is what keeps our clients coming back year after year, and sending their family and friends to us for advice.
