The new financial advice regime begins on 16 March 2023, yet – says the FSC’s CEO Richard Klipin – many advisers are burying their heads in the sand when it comes to getting a full FAP license.
In an effort to encourage more transitional license holder to apply for a full license, the FSC has released its top 10 list of myths it says some advisers are telling themselves.
“We have been supporting the advice community through the transition to the new rules over the past few years,” says Klipin.
“From 16 March, anyone who gives regulated financial advice to retail clients will need to have a full licence – or be engaged by a licensed Financial Advice Provider as a financial adviser or nominated representative. If not, they will be breaking the law.”
Klipin says some of the myths the FSC has heard include:
- If I keep ignoring the new requirements, it will all go away
- I have my transitional licence so feel comfortable that I can roll up into another of my dealer group FAPs for full licensing closer to the March deadline
- I’ve never had a complaint and none of my clients would ever complain, so it won’t matter
Trisha Edmonds, Co-Chair of the FSC’s Professional Advice Committee, says some of the feedback she’s heard from parts of the adviser community ranges from denial to misplaced confidence they either don’t need to, or will be able to meet the needs of the regime, the day before the cut-off.
“This simply isn’t the case,” said Edmonds.
The FSC’s Financial Advice Law Guide is designed to help financial advisers through regulatory changes.
The FMA recommends transitional FAP license holders start their application for a full license right away.