Advisers Should Clarify Their Status – Strategi


Advisers have been urged to clarify their professional status and decide how they will work under the incoming regulatory regime.

The call has been made by Strategi‘s Head of Risk and Compliance, Selvan Naidoo, who recommends every adviser planning to remain in the industry after 15 March next year should ask themselves some important questions.

For example, he says all advisers will need to know their legal status.

“Will I be a financial adviser or nominated representative and what is the implication of each status?” he says. “Will the terms of my employment change and will I be taking on more, less, or the same level of risk?”

Selvan Naidoo, Strategi's Head of Risk and Compliance.
Selvan Naidoo, Strategi’s Head of Risk and Compliance, says advisers need to clarify their professional status.

On the training front he suggests advisers review their qualifications and decide if more study is required, what courses are needed and – if so – who will pay for them.

“If the training is in-house, then is it recognised elsewhere, or will I then need to do formal qualifications if I leave my current employer?” he says.

He also says changes to the advice process need to be recognised, understood and prepared for. For example, if new templates and process are introduced will they be ready to test before the start of the new regime?

He also suggests there could be changes with employment agreement KPIs to reflect the added risk a financial advice provider or authorised body will assume.

If the training is in-house, then is it recognised elsewhere…

And Naidoo questions how incentive and bonus schemes could work in an environment that is no longer totally volume and value based. Advisers, he says, also need to know what they should do to meet the new compliance standards, and good conduct obligations.

Finally, he suggests advisers need to know about any changes to business processes. Saying advisers should find out if new systems and procedures will be gradually introduced along with new software and templates over coming months or if there will be a massive change on 15 March 2021.