ob体育

media release (24-258MR)

Financial Services and Credit Panel issues registration suspension order

Published

The Financial Services and Credit Panel (FSCP) has made an order to suspend the registration of financial adviser Ian Reid for three months from 21 November 2024. Mr Reid鈥檚 financial adviser registration is not in force during the suspension period and he must not provide personal advice to retail clients in relation to relevant financial products.

The FSCP found Mr Reid had not complied with his obligations when providing advice to three clients. Mr Reid used records of advice (ROA) that relied on statements of advice (SOA) that had been given to the clients up to seven years ago.

The FSCP was reasonably satisfied that the further advice exemption from giving an SOA in regulation 7.7.10AE of the Corporations Regulations 2001 did not apply to two of the three clients because there had been changes in those clients鈥� relevant personal circumstances which were significantly different from that in relation to the previous advice.

For all three clients, the FSCP was reasonably satisfied that the s961B and s961G obligations were not complied with. This was because there was not sufficient evidence on the client files:

  • that reasonable enquiries were made about the client鈥檚 relevant circumstances
  • that, of the enquiries that were made, the results of those enquiries were taken into consideration and advice scoped appropriately
  • that the clients鈥� strategic advice needs were taken into consideration
  • demonstrating why the previous recommendations in the SOA remained appropriate, and
  • that the relevant provider based all judgements in advising the client on that client鈥檚 relevant circumstances.

Background

The FSCP

The FSCP makes administrative decisions on matters referred to it by ob体育 that relate to the conduct of financial advisers. The FSCP is a pool of industry participants, appointed by the Minister, that ob体育 draws upon when forming individual sitting panels. Each sitting panel comprises an ob体育 staff member and at least two members of the FSCP.

The FSCP operates separately from, but alongside, ob体育鈥檚 existing administrative decision-making processes, with the aim of responding to lower-level misconduct and ensuring that minor misconduct does not go unaddressed.听

The FSCP has the power to make a registration suspension order under s921L(1)(b) of the Corporations Act. The FSCP鈥檚 decision has been published on the FSCP Outcomes Register on the ob体育 website.

ob体育 referred Mr Reid鈥檚 conduct to the FSCP following an ob体育 review that examined why some superannuation members continue to invest in persistently underperforming investment options under their choice superannuation products.

ob体育 REP 779

In February 2024, ob体育 released Report 779 Superannuation and choice products: What focus is there on performance? (REP 779). ob体育 looked at the conduct of superannuation trustees (trustees), financial advisers (advisers) and Australian financial services (AFS) licensees (advice licensees) to examine why some members continue to invest in persistently underperforming investment options under their choice superannuation products.

The requirement for financial advisers to be registered was introduced by the , in response to Recommendation 2.10 of the Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry.

Records of advice

In November 2021, ob体育 released guidance on ROAs which answers frequently asked questions about ROAs and illustrates three ROA examples to provide clarity to financial advisers and advice licensees on their obligations when using ROAs to provide personal advice to retail clients.

For further information on the FSCP, the financial adviser registration requirement and records of advice see: