Any financial adviser working for a bank will now have up to five years of their employment history made available to other banks. This is a new protocol devised by the Australian Bankers' Association (ABA) in an attempt to snuff out the hiring of unethical practitioners.
The new protocol involves reference checking and information sharing regarding an adviser's compliance, risk management, and advice quality on Tier 1 financial products. Up to five years of activities can be sought.
This new system will help stop suspect advisers simply shifting between licensees after being dismissed for poor conduct, and who do not meet minimum ethical standards.
What the protocol does not cover
- Other background checks like police checks/qualification checks
How does the new protocol work?
The protocol involves a series of standardised questions and record-keeping practices. This will include the checking of references and information will be shared with subscribed licensees. This will apply from March 2017.
The licensees currently subscribed include AMP, ANZ, Bendigo and Adelaide Bank, Commonwealth Bank, Macquarie Group, National Australia Bank, Suncorp Group, and Westpac, plus the 30 financial advice groups these banks operate. This equates to 38 per cent of the financial advice market in Australia.
Banks and other financial advice providers can become a subscribing licensee by contacting the ABA.