Consumer protection central to financial advice reforms

The financial advice ‘best interests’ duty has been saved again, according to CHOICE and Super Consumers Australia responding to the Federal Government’s proposal to reform financial advice laws.

Quotes attributable to Gerard Brody, Acting Director of Super Consumers Australia:

“The Quality of Advice Review had proposed a weak ‘good advice’ duty for some forms of financial advice. It’s a win that the Federal Government has rejected this radical attack on consumer protection, and has instead upheld the best interests duty.

“The best interests duty is vital in light of conflicts of interest which have riddled the financial advice sector. Australians deserve independent and high quality advice.”

CHOICE and Super Consumers also welcomed proposals to reduce costly paperwork associated with financial advice while retaining consumer protections. 

“Paperwork and failed disclosure has added to the cost of advice, but people definitely need a record of any advice provided that is clear, concise and helpful.” 

The consumer advocates look forward to examining the details of changes to the rules relating to banks, super funds and insurers providing financial advice. 

“Conflicts of interest remain real in any financial advice model which is provided by banks, super funds or insurers. What we don’t want is product sales dressed up as ‘advice’. We look forward to participating in future consultations to make sure the standards are sufficient.”