Thursday, 17 November 2016

The Code of Conduct for all Australian Financial Services

Numerous independent financial planners sydney in Australia provide around 2 million Australians with financial services. These services include buying property, investments, wealth creation, debt management, tax management, superannuation advices, and retirement management.
These services demand profound sharing of personal financial data of a person. Therefore, hiring the right reliable advisor is essential. Most financial advisers are expected to be legally licensed under RG146 of Australian Financial Services (AFS).

However, a license alone cannot justify the adviser’s character alone. There are certain duties and responsibilities that are associated with financial industry by the Australian Government’s Australian Securities and Investment Commission (ASIC). These regulations also justify the expected ‘code of conduct’ of financial companies.

General Duties
The general duties of financial services provider are to deliver honest and unbiased financial services, fairly, and with appropriate skills. The provider should deliver services with care, diligence, and in the fair interest of their clients as well as the morality of the financial services industry.

Specific Duties
  1.       Representations and information provided to the client should always be factually correct.

  2.       The information and fact must be provided in plain and easy-to-understand language.

  3.       The language used should be as such that avoids any uncertainty or confusion.

  4.       The advice or information should be appropriate and adequate in accordance with the conditions of the financial service.

   5.       Haste should be avoided. Client should be given sufficient time to make a thoughtful financial decision.

   6.       The client must be provided the Code either orally or writing. Whatever may the means or format be of information the language must be clear.

   7.       If the format is in print or digital format, the font size and spacing should be legible, unconfusing, and readable.

   8.       All sums, values, charges, fees, remuneration, or monitory obligations must be mentioned with details. The basis of all amount, sums, values, charges, fees, remuneration, or monitory obligations that are not pre-determined must be informed about with calculations adequately described.

   9.       Any conflict of interest between the provider, client, or representative and a client must be avoided.

1 0.   In case any conflict of interest arises, the client must be informed at the earliest possible opportunity.

1 1.   All information, records, and material documentation that regards the client must be kept with due knowledge of client.

1 2.   The records, material documentation, and information about the client and rendered financial services should be kept until 5 years after termination with knowledge of client.

Although, the ASIC has a proper code of conduct for all Australian financial services, there are certain advisers who still try to breach it. The most practiced tactics of a dishonest financial advisor are,
1.       Selling dividends
2.       Unsuitable transaction
3.       Withholding recommendation to invest
4.       Unduly trading your account
5.       Emotional manipulation
6.       Lavish offices
7.       Complex strategies

Whom do you complain about a dishonest financial advisor?
You might currently be dealing with a financial advisor that does not completely comply to the code of conduct or one who is using one of these mentioned tactics. In circumstances as such, you might require to complain about your current advisor replace him/her with a much more reliable person. However, there might be less clarity regarding whom do you complain or talk to about it. Here is some help.

1.       You can talk directly to the adviser.

2.       You can complain to the adviser’s association/company.

3.       You can make a formal complaint through RG165’s adviser’s internal dispute resolution system.

4.       In case, you find the solution unsatisfactory, you can proceed with making a complaint to external dispute resolution system.

Two external dispute resolution schemes approved by ASIC are,

1.       Financial Ombudsman Services Limited (FOS)
FOS deals with various financial and credit services as well as products, which include complaints against banks, credit unions, foreign exchange dealers, deposit takers, credit providers, mortgage brokers, general insurers, life insurers, fund managers, financial advisers and planners, stockbrokers, and superannuation providers.

2.       Credits and Investments Ombudsman (CIO)
CIO takes charge of complaints against credit unions, building societies, non-bank lenders, mortgage and finance brokers, financial planners, lenders and debt collectors, credit licensees and credit representatives.

How do you choose a dependable and honest financial adviser?
There various financial service providers across Sydney, therefore, you will have a wide choice to choose from – take complete advantage.
1.       Find a firm that lets you talk to some its clients.
2.       Choose a local firm so that it is easy for you to meet them, meet their clients, and have occasional discussions.
3.       Ask about its payment beforehand.
4.       Know about all the services they provide.
5.       Consider knowing your adviser’s pay structure.
6.       Find a firm that maintains adequate transparency.
7.       Interview probable adviser


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