An independent review has recommended banks, fund managers and insurers should be exempt from the duty to act in the best interests of investors when giving financial advice.
Allens lawyer Michelle Levy has withstood pressure to water down her controversial plan to encourage banks, fund managers and insurers to give financial advice by exempting them from the duty to act in clients’ best interests, following her year-long review of the sector’s complex regulations.
The final report clarified that the proposed “good advice” duty would contain implicit consumer protections that are, in Ms Levy’s opinion, more effective than the best interests duty introduced by Labor in 2012. If implemented by the government, advisers would no longer be required to provide lengthy statement of advice documents to clients. Instead, they would be required to keep records and provide notes to clients upon request. They would also no longer have to provide fee disclosure statements to clients.
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