Whistleblower Jeff Morris has published a paper, commissioned by ClearView, on Approved Product Lists (APLs) saying that institution-associated Australian Financial Services (AFS) licensees are putting clients into in-house products. This may breach best interest duty obligations.
Morris is advocating for a ban on the use of APLs by vertically-integrated financial advice licensees, saying the industry isn’t able to self-manage conflicts of interest.
Morris said that ‘institutionally-aligned AFSLs knew all the right things to say and how to look remorseful but scratch the surface and there have been no real changes’.
The paper, Approved Product Lies: Combating the manipulation of advice, says we have no reason to exclude any of the 12 retail life insurers when choosing insurance products for clients. It’s still the norm, however, for an APL to be heavily restricted, rather than encouraging advisers to use the best-suited product.
Morris states unequivocally: "…restricted life insurance APLs are unsustainable and unjustifiable in the emerging financial advice profession."