The government’s decision to dig deeper into the collapse of financial services firms should be congratulated.
Superannuation and Corporate Law Minister Nick Sherry gave the announcement the green light, after reinforcing its importance.
“The Rudd government feels for families affected by these corporate collapses,” Sherry said.
“I understand the committee will explore issues associated with the recent corporate collapses, including Storm Financial and Opes Prime. I understand this includes the role played by financial advisers, current remuneration structures such as fees and commissions and the current regulatory environment, including licensing arrangements, for providers and advisers.”
Industry associations the FPA and Association of Financial Advisers joined Sherry in giving the inquiry the nod, though not without a few pointed suggestions.
Both associations have called for the inquiry to avoid starting or ending in a witch-hunt.
“We call on the government to ensure that this inquiry is fair and open. A witch-hunt or an attempt to enable one sector to get a competitive advantage over another will not achieve anything,” FPA chief executive Jo-Ann Bloch said.
“FPA members were not involved in Opes Prime or Lehman Brothers and the Royal Bank of Scotland. To even imply that financial planners are the cause of all the named ‘and other’ corporate failures in Australia is offensive and misguided.”
AFA president Jim Taggart said the truth was there were many parties who shared the responsibility for the collapses and while the collapses had tarnished the reputation of all in the financial services sector, they represented only a fraction of companies operating in the industry.
“The vast majority of financial advisers are fine corporate citizens who serve their clients and their communities well and do the right thing,” Taggart said.
A number of you may call the inquiry too late in the piece and declare that the damage has already been done.
And well, to be honest, you may well be right. Though surely having the option of learning how the collapses of Opes Prime and Storm Financial actually happened would be worth it?
Imagine being given the choice, knowing or not. I’d want to know.
Though on the flipside, perhaps what might be of interest is to learn what you think may come out of the inquiry?
Do you think the inquiry will actually achieve something or is it just smoke and mirrors to give the appearance the government is actually working for the industry rather than against it?
