Here’s the story so far..
The Future of Financial Advice (FOFA) reforms were introduced in July 2013. Since then, compliance across financial practices has come under scrutiny by the government’s Treasury Department. These reforms were intended to boost the trust and confidence of retail investors in the financial services sector. The idea was that:
a) accountability, and
b) compliance with reform measures,
would ensure consistent quality of financial advice available to consumers.
Now, generally speaking? Under the FOFA reforms, financial advisers are required to disclose ongoing advice fees (a yearly fee disclosure statement letter to the client), provide opportunities to opt-in (or opt-out) of these fees, a review cycle and access to their adviser. Not only does meeting these obligations ensure compliance with the legislation, it also helps to ensure that advisers stay in contact with their clients and continue to provide quality customer service for them.
Then in March this year, a Melbourne- based risk advice licensee became the first advisory group to be prosecuted for breaches of the FOFA reforms, after it was found they’d neglected to act in the best interests of their clients. As a result of these findings (but in a separate action) ASIC banned two of the authorised representatives from providing financial advice for five years.
So as we can see, FOFA is a big deal!
Compliance is absolutely critical, and getting solid processes in place to ensure compliance is vital. However, getting the required statements and setting review appointments with clients is time consuming work. This can take revenue-earning staff offline for days- even weeks- at a time. At Paperwork Magic, we understand how important your time is when it comes to your daily and weekly earnings. To ensure your compliance with FOFA and keep your business running smoothly, we produce FDS and opt-in statements for financial planners, and we have a thorough understanding of compliance requirements.
So, if FOFA is in the too-hard basket for your business? Find out what we can do for you, and give us a call today!