A range of new consumer protection measures proposed by the Palmer United Party were agreed to by the Federal Government today in a major win for everyday Australian investors and responsible financial advisors.
Following discussions with the Palmer United Party over the Future of Financial Advice (FoFA) laws, The Minister for Finance, Mathias Cormann, on behalf of the Government, has tabled a letter in the Senate today stating that the Government will make further regulations within 90 days to ensure key changes to improve affordable, high quality financial advice, removing unnecessary and costly red tape, while protecting investors.
Palmer United Party federal leader and Member for Fairfax, Clive Palmer, said his party could only support financial advice laws that were “fair for all Australians”.
The government has agreed to Palmer United’s strengthened consumer protection provided by financial advisers to their clients and signed off by both.
These measures which include:
- That the adviser is required to act in the best interests of their client and prioritise their clients interests ahead of their own.
- That any fees are to be disclosed and that the adviser will provide a fee disclosure statement annually.
- That a client has the right to return financial products under 14-day cooling-off period.
- That the client has the right to change his or her instructions to their adviser, if for example they experience a change in their circumstances.
The Government has also agreed to establish an enhanced public register of financial advisers that includes the adviser’s credentials and status within the industry.
“The Palmer United Party will only support FoFA regulations that are unambiguous, transparent and clear,’’ Mr Palmer said.
“It appears that a common-sense approach has prevailed following a successful conversation with the Minister and the diligent work of the Palmer United Senate team which always has the best interests of Australians at heart,” Mr Palmer said.
“We cannot have a FoFA framework that puts ordinary Australian investors at risk, where their retirement plans could be potentially ruined by unscrupulous financial advisors putting their own interests first,’’ Mr Palmer said.
“Our solution for Australians is not the Liberal way or the Labor way, but the right way.”
“We must have a system where the best interests of the clients are taken into account,’’ Mr Palmer said.