Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry

Not sure best place to post

The Commissioner, the Honourable Kenneth Madison Hayne AC QC, is authorised to submit an interim report no later than 30 September 2018, and will provide a final report by 1 February 2019.

​

The Productivity Commission also raised concerns about the Superannuation Savings of Australia's aging population being eaten away by high fees in many retail funds

Australian workers’ retirement savings eroded by high super fund fees



Royal commission: get forensic on your finances to check you're not being ripped off

Thousands of investors thought they were doing the right thing by approaching their trusted bank to get advice on anything from a mortgage and investments to superannuation and insurance. But, like the rest of the country, they've listened spellbound as the second – equally explosive – round of the banking royal commission unfolded this week.

Aided by nearly 4000 public submissions, we have heard jaw-dropping revelations about fees-for-no-advice, a sales-driven and even corrupt corporate culture, and repeated failures to reprimand the culprits.

What's more, the commission has laid bare the inadequacy of the broader compliance structure.

An estimated 85 per cent of Australia's advisers are employed or licensed by a bank or large financial institution. But where they're just licensed, it takes some digging to discover – so many clients do not even realise their trusted adviser is, in fact, a torn one.​

 

Don't know what the big deal is, most sales jobs are filled with charlatans and crooks. Car salesman, insurance salesman, gym membership salesman (the worst) Or should i say salesperson.

Actually, thats a bit harsh. Not Crooks but sales is filled with people who feel pressured or are desperate to make a sale in order to make budget/have job/get commissions etc..

 

The regulators banned commissions and increased compliance obligations.

Most planners were unable to earn a living charging fees independently, especially with the ever increasing cost of compliance.

The industry consolidated with most planners working for the product suppliers, either directly or indirectly (most FP firms are owned by fund managers).

Their employers insensitive the planners to sell their own products. They receive bonus' for doing this in addition to the fees being charged.

FPs moved from being advisors to product sales people.

In order to meet KPIs and earn bonus', the FPs have become more and more sales focused, often acting outside of the clients best interest to realise these standards.


This came about because commissions were perceived to create a conflict of interest (perceived, not proven), so they restricted how planners are paid to reduce bad behaviour. Instead they should have found ways to reward good behaviour.

Restricting how someone is paid and increasing their workload doesn't improve their behaviour, it makes them to cut corners and forces them to put their own interests first.