FINRA also has an enforcement role and in 2013 brought 1,535 disciplinary actions against registered brokers and firms in the US and referred 660 fraud and insider trading cases to the authorities.
“We need a stringent exam like that that really tests the knowledge and skills of our financial advisers and puts the interests of investors first,” Phillips says.
ANZ has offered to contribute $600,000 to the start-up costs of the organisation with the costs recouped by ANZ based on fees charged to financial advisers who sit the exam.
The report released this week recommends financial advisers providing personal advice should meet extra-education standards in specific areas such as superannuation and undertake ongoing training.
It says the government should prioritise a review of minimum standards, with many stakeholders supporting education requirements to a degree level. But Phillips says that may take years and a national exam that adequately tested the competency of advisers was also a better solution.
“Requiring an exam for all financial advisers, will go a long way to helping lift the level of confidence people have in the industry and it would encourage more people to seek advice,” she says.
“Under current laws, financial advisers can be fully certified to provide both general and private advice by obtaining a diploma of financial planning. An annual exam will help create a more robust training framework for advice.”
ANZ supports the installation of an industry framework for training and professional development as outlined by the Financial Services Council.
The level of professionalism in the financial planning industry has been an issue for consumers for some time and we need to rebuild the level of trust people have with planners, Phillips says.
“We need to get moving on this and I will start taking steps with my peers.” she says. “There are models working in other markets we can learn from and I think now is the right time for the industry to get on with it.”