The prevalence of property spruiking involving the use of SMSFs has fallen away, but unlicensed advice remains a concern, according to ASIC, which has encouraged financial advisers to report any instances of unlicensed advice they identify.
Speaking during a FPA Sydney Chapter webinar today, ASIC financial advisers senior executive leader Kate Metz asked advisers watching the webinar to provide input on the issue of property investments and SMSFs, noting it was less of a problem than in the past.
“I would like to hear your thoughts on this, but for me this is an area that has become less noisy in the last year to 18 months and I don’t know if it will start up again, but we are seeing fewer examples of people setting up SMSFs, borrowing and then investing in property,” she said.
Metz said there had been cases of unlicensed advice related to COVID-19 relief measures, but outside of this event the regulator was still seeing other instances of unregulated advice.
“We saw a spate of unlicensed advice in the context of early access to superannuation, for instance, a number of real estate agents were pushing people to access $10,000 to pay rent. We took action and wrote to real estate agent associations and dealt with some of the worst examples.
“In the case of the real estate agents, the error was inadvertent and they did not understand where the line was between what is giving advice and giving information. As soon as they heard from us they withdrew the comments they made.
“When we take real estate agents out of the numbers – they made up the vast bulk this year – we are seeing an increase and it is a space we are watching carefully.
She also called on financial advisers to assist the regulator by providing information about unlicensed advice provided by life coaches.
“Where someone has set themselves up as a life coach, or money coach, we deal with those on a case-by-case basis, which we have been doing, but we are keen to hear from advisers and keen for any intelligence you can give us,” she said.
“This is not the easiest area to try and work out what is happening. Often we hear of something, but it is difficult to find documentation or evidence, so anything we can be provided with is useful.
“Unlicensed advice is a topical area for us. We don’t want to see people giving unregulated financial advice, as do none of you – it does not help anyone in the industry for that to happen.”