ASIC: An alarming number of incentives being offered to financial planners
A reader has alerted us to a report/warning from the corporate regulator discussed in the Australian Financial Review 24 May 06. Although it is well known that planners accept sales incentives, the sheer number of these practices came as real surprise to ASIC researchers.
Commissions paid to planners by managed funds are legal so long as clients are told. It is very much up to the investor to read the fine print and there is little the Australian Securities and Investment Commission can do to fix problems arising from investor ignorance unless the federal government changes the law, which appears unlikely.
The disclosure of these commissions can be very complex – the word ‘tricky’ comes to mind – for those not on the lookout, not asking the right questions, and not prepared to plough through bulky documents.
Food for thought:
A shocker to finish!