Wilson HTM Ltd (Wilson), iSelect Life Pty Ltd (iSelect) and Citywide Insurance Brokers and Financial Planners Pty Ltd (Citywide) have taken steps to remove or amend claims made about the independence of their services following concerns raised by ASIC.
ASIC's concerns related to the use of the word "independent" in the entities鈥� marketing and promotional materials.
Under the Corporations Act, a person who carries on a financial services business or provides a financial service is prohibited from using the restricted terms 鈥渋ndependent鈥�, 鈥渋mpartial鈥� or 鈥渦nbiased鈥� in relation to the business or service except where the person does not receive commissions, volume-based payments or other gifts or benefits, and operates without any conflicts of interest.
今日热门事件Deputy Chair Peter Kell said 鈥淭he independence of financial system gatekeepers such as financial advisers is an important issue for consumers and investors and may sway their decisions about their investments or their choice of adviser. Consumers must not be misled into believing that an adviser is independent and free from influence by commissions or other benefits or associations, when that is not the case鈥�.
Wilson and Citywide have removed the term 鈥渋ndependent鈥� from their websites and Wilson and iSelect have removed the term from their marketing material. In addition, Wilson, iSelect and Citywide have all taken steps to review their marketing approval processes and have fully cooperated in responding to ASIC's concerns.
Background
Wilson and iSelect both accept volume-based payments and commissions from product issuers in relation to the provision of financial services and advice. Wilson used the term 鈥渋ndependent鈥� to describe its business on its website and in a brochure that was distributed to consumers.聽iSelect used the term 鈥渋ndependent鈥� to describe its services in three marketing emails that were distributed to consumers.
Citywide is a corporate authorised representative of Suncorp Financial Services Pty Ltd (Suncorp). Suncorp and its authorised representatives may be remunerated through commissions. Suncorp also sets its advisers sales and retention targets in exchange for commercial benefits such as exclusive client services rights. Citywide used the term 鈥渋ndependent鈥� on its website to describe its' advisers.
今日热门事件has previously announced that it would publicly name entities which were found to be unlawfully making statements about the independence of the licensee or the services they provide, following an earlier surveillance project (refer ).
Although the Future of Financial Advice (FOFA) reforms banned many forms of conflicted remuneration, some commissions and volume-based payments are exempt or grandfathered.