ISA attacks changes to financial advice laws
CHANGES to financial advice laws the Abbott government has begun putting in place could allow commissions and other incentives for advisers, the superannuation industry claims.
After Finance Minister Mathias Cormann on Monday registered the government's changes to financial advice laws, Industry Super Australia has gone on the attack.
One of the key critics of the government's changes, ISA chief executive David Whiteley said there were "nine ways" the government's changes had brought back commissions.
Among the loopholes the ISA found were that assurances a ban on "conflicted remuneration" sales incentives, ongoing "asset fees" and exemptions on general advice could see conflicted advice slip through the net.
"When you analyse the fine-print, it is clear that the banks' lobbying has been successful and they will once again be able to pay incentives to financial advisers to sell their products," he said.
"Financial planners cannot act as impartial advisers and receive sales incentives from banks."
Other questionable payments the ISA said would still be allowed included banks being able to pay commissions to advisors on volume of sales of financial products and "permissible revenue" exemptions on bonuses.
But the changes, registered as regulations on Monday, may not last long, with the Senate expected to pass a "disallowance motion" when possible to prevent the regulations remaining in place.