The Minister for Financial Services and Superannuation, Bill Shorten, has agreed to take the debate of restricting the term financial planner to Government following a call to action by the FPA.
In his address to an FPA luncheon yesterday, Shorten said the industry view that the government needs to seriously examine whether or not it should put the words 'financial planner' into the corporations law has to be addressed.
"I will certainly undertake that debate with the Government because I do think the arguments are well put about consumer protection and the need to have the industry recognised to be in fact a profession," he said.
Shorten's comments were in response to FPA chair Matthew Rowe's call on the Federal Government to resolve the "glaring anomaly" in the financial planning system.
"Under the Corporations Act there is no constraint in individuals calling themselves financial planners irrespective of their training, competency and even licensing," Rowe said.
"However, the current legislation does restrict the term stockbroker, futures broker, insurance broker, general insurance broker and life insurance broker. Why do such terms carry more weight under law than that of financial planner? The time has come for the term financial planner to be enshrined under law.
"A lack of restrictions on the term financial planner we believe is among other things a significant gap for consumer protection. It leaves trusting consumers open to influence by unprofessional and inappropriately qualified individuals calling themselves financial planners."
Rowe said the FPA believes such anomalies are matters of grave public concern.
"There are 16,000 financial planners in this country. Eight thousand are FPA members who are bound by our code. We estimate that roughly 2,000 financial planners are members of the accounting professional bodies," he said.
"This means there are 6,000 members or more than a third that today work in an ethical and professional vacuum. Now frankly this statistic left unchecked presents a bleak prospect for the future."
