AstuteWheel: new digital tool providing SoA's in an hour
Fintech company AstuteWheel has launched a new financial advice tool to provide Statement of Advice (SoA) documents digitally in about an hour. The Astute Insurance Planner uses an online fact-finding and risk-needs analysis calculator, also developed by AstuteWheel, with risk research and quoting tools by OmniLife, with an SoA wizard and client management facility designed by YTML.
Much of the SoA process can be automated, with key information added at the beginning of the session that pre-populates the risk needs analysis tool and copies information into the client management tool. The initial client meeting would take 30-40 minutes to determine appropriate insurance cover, then using other tools to find comparisons and quotes. Once a product is selected, an SoA was created in 10 minutes.
Integrity Life to launch retail suite in October
Integrity Life, a life insurance start-up, is to launch its retail produces to financial advisers in October. A soft launch is expected to a small group of advisers in September. The company has aimed itself at providing insurance products that override institutional 'pain points'.
Macquarie quits grandfathered commission
Macquarie is to remove grandfathered commission payments for financial planners who work in the wealth management arm of the business. Advisers will not receive trailing commissions for Macquarie products as of April 2019, with advisers receiving grandfathered payments from third-party channels unaffected. Macquarie said around 17,000 clients will benefit from the change.
Recently BT Financial Group also scrapped grandfathered commission payments to financial planners across Westpac, St. George, Bank of Melbourne, and the BankSA network. Both financial institutions are responding to the Royal Commission's criticism regarding grandfathered commission payments and the recommendation that these payments be eliminated because they do not provide a benefit to consumers that equals the cost.
HSBC exits financial advice, closing its financial advice doors
HSBC Australia is closing its retail financial advice arm after a strategic review. The financial advice business at HSBC, according to a spokesperson, lacked sufficient scale and potential for growth. Staff were either made redundant or moved to a new role within the company.
Doors will be closed permanently from about September 2018, with all existing investments or insurance products, provided through third parties, still being held. The number of financial advisers affected is thought to be about five. HSBC is not the first company to ditch its financial advice offerings recently, with CBA, NAB and ANZ all divesting themselves of some or all of their advisory offerings.
ASIC vs. Refocus Financial Group
ASIC has commenced legal proceedings against Queensland businesses Refocus Financial Group, Consultia Super, and directors/managers, Heather Swift and Brett Gordon, after at least 10 financial advice clients loaned $1.4 million to Diverse Capital Management for property developments. This money remains outstanding, with Diverse having been placed into liquidation in May 2018. ASIC alleges that Gordon used the funds for personal use and working capital for Refocus, with other allegations of breaches associated with the financial advice business and unsecured loans.
AMP FP facing civil penalties for alleged failures in insurance advice
ASIC has commenced proceedings against AMP Financial Planning regarding an alleged failure by AMP FP to make sure its financial advisers were complying with best interests duty and other obligations. ASIC is alleging that specific AMP FP advisers had engaged in rewriting insurance policies for more expensive policies that cancelled the client's existing insurance, and a new policy being written that resulted in a new commission payout.
ASIC says this type of advice was inappropriate and the advisers did not act in the best interests of their clients. ASIC says that AMP FP knew or ought to have known that some of its advisers were rewriting policies to the detriment of clients, but did not take reasonable steps to rectify this.
ASIC pursuing advice firms misusing term 'independent'
ASIC is looking into four financial advice companies using restricted terms, 'independent' and 'independently owned', forcing a stop to the use of the terms, and amendments to be made to claims that were misleading. The companies found to be breaching regulations include:
- Financial Spectrum – an authorised representative of Spectrum Wealth Advisers (Sydney, NSW)
- James Gerrard – an authorised representative of Australian Financial Advisory Group (Sydney, NSW)
- PWK Private Wealth Advisers – an authorised representative of Paragem (Brisbane, Qld)
- Debbie Hudson Financial Services Pty Ltd (trading as Wealth Fusion) – an authorised representative of Paragem (Adelaide, SA)
CBA to pay $20 million for bank bill trading breaches
The Commonwealth Bank of Australia (CBA) has entered into an enforceable undertaking (EU) with ASIC regarding the setting of the Bank Bill Swap Rate (BBSW). CBA is to pay $15 million to benefit the community, with $5 million in ASIC's legal costs. Further monitoring is required. CBA has admitted that it failed to do everything it needed to, to ensure its traders were adequately trained and that the company was providing financial services honestly and fairly.