NEWS - 64 Media

CSSA: GOVERNMENT BACK FLIPS

Fri, 18 May 2012 00:00:00 -1000

Hundreds of thousands of superannuation members stand to lose their insurance cover.

With submissions on MySuper Tranche 3 due 16th May, the Corporate Super Specialist Alliance (CSSA) is concerned that a significant number of corporate super members are in danger of losing their insurance cover.

According to CSSA President, Mr Douglas Latto, there is a fundamental flaw in the assumptions made by Treasury regarding what happens to a member’s benefits when they leave a corporate superannuation fund.

”When an employee leaves their employer, and is no longer eligible to be a member of that employer’s corporate fund, and no instruction has been received from the member, current practice is that benefits are transferred to a personal fund, with, in most cases, the insurance cover being transferred as well,” Mr Latto said. ”This is commonly known as ’flipping’. With the introduction of MySuper in July 2013, this practice will disappear.”

Treasury has suggested that all these funds are transferred to a MySuper fund by 1 July 2017 if the member has not made an investment choice. The CSSA has termed this as ’back-flipping’.

The concern is that Explanatory Memorandum 6.40 suggests that most insurance arrangements attached to investment benefits cease at the point a member leaves a fund - the opposite to what actually happens. It assumes that an automatic transfer to a MySuper fund will not result in lost benefits.

“We have conducted our own research and found that 74% of members with balances over $1,000 have insurance cover within their fund,” Mr Latto said. “This increases to 81% for balances over $10,000. This cover could be for death, total and permanent disablement, income protection, or all of these.

”For many members, this may be the only cover they have and, if lost, it could prove to be too difficult or onerous to obtain replacement cover outside of automatic arrangements under super.

”With the underinsurance of the Australian market being a major concern, the introduction of a process which will result in the loss of this cover is disturbing.

“The Treasury proposal is that members be given an ‘opt-out’ option to elect not to be transferred to a MySuper fund and have a subsequent loss of benefits. But, as we know, without advice, many people will not fully understand the consequences and simply do nothing - especially at a time when they are likely to have other things on their mind, such as starting a new job.”

So what’s the answer?

”The CSSA submission is proposing that, rather than a member being required to ’opt out’, the option should be to opt-in to the MySuper offer,” Mr Latto said.

SYNCHRON LAUNCHES SYNCHRON MEDICAL

Thu, 17 May 2012 00:00:00 -1000

At the recent Synchron national conference Synchron Director, Mr Don Trapnell, announced the launch of Synchron Medical.

“Currently, if advisers need to arrange medical investigations for a client, they coordinate this using a pathology service via the underwriter,” Mr Trapnell said. “While this may be an efficient process, it can leave the adviser out in the cold, making it difficult to follow up and keep their client in the loop.

“As a licensee, we believe our advisers should have greater control over the use of paramedic services and have, therefore, entered into a joint venture with Health Predictions to create Synchron Medical."

Synchron Medical is a mobile pathology service which can provide all the reports an adviser needs to obtain to ensure the smooth passage of insurance through the underwriting process to completion – from simple blood tests through to specialist medical examinations.

“Synchron Medical’s point of difference is its online capability, which allows the adviser to request, track and monitor the status of medical tests and information – giving control of the insurance application process back to the adviser on behalf of their clients,” Mr Trapnell said. “The intention is not to cut the underwriter out of the loop but to fit into an already streamlined processes.”

Synchron Medical Business Development Manager, Lainie Clover, said that the service has already been accepted by all insurance companies and the next step is to include the ability to arrange PMARs – one of the major time lags in getting insurance applications through to completion.

“We see this as being a boutique, personalised service for Synchron advisers, saving time and drop outs,” Ms Clover said. “Advisers will be allocated a personal consultant within Synchron Medical and this staff member will action referrals on the same day, providing a rapid turnaround time for clients and regular updates to the adviser on the progress of each case.”

Mr Trapnell said Synchron is already in discussion with several underwriters to have Synchron Medical made a preferred service so that, wherever a case is submitted by a Synchron adviser, the paramedic service used will be Synchron Medical.

“The launch of this facility has definitely struck a chord with our advisers as all 90 of the adviser delegates attending the conference last month have registered for the service,” he said.

64 MEDIA ENGAGES CHERYL McKEVETT, PUBLIC RELATIONS CONSULTANT

Tue, 15 May 2012 00:00:00 -1000

64 Media is pleased to announce that we have engaged the services of Cheryl McKevett as Public Relations Consultant.

After completing high school, Cheryl plunged straight into the word of financial services, beginning her career in life insurance administration.

Since those early, simpler times, she has worked across many areas of the industry, with the last 15 years focussed on the training, support and coaching of financial advisers.

With experience gained from working with large corporates through to self employed businesses, (and everything in between!) Cheryl is able to see most sides of the issues facing our industry and, having played a prominent role in the implementation of FSR into a leading dealer group in 2003, is ideally placed to understand the challenges facing advisers in a post FOFA world.

Cheryl has qualifications in both Life Insurance – Snr Associate ANZIIF – and financial planning - DFS (FP); is RG 146 compliant and currently completing the Adv DFS (FP).

She has also held Authorised Representative status with a well regarded licensee and has served on the FPA’s Careers Expo committee for 4 years.

Cheryl passionately believes in the value of advice and the need for it to be seen as an essential service for all Australians and looks forward to continuing to be involved in our industry as it grows and develops into a profession.

Cheryl will be working with 64 Media on a consultancy basis, helping us to deliver outstanding public relations services to our clients.

SYNCHRON’S FINN KELLY TAKES OUT MONEY MANAGEMENT’S YOUNG ACHIEVER OF THE YEAR AWARD

Mon, 14 May 2012 00:00:00 -1000

Finn Kelly, CEO of Wealth Enhancers, a Synchron-aligned financial advice practice based in Victoria, has won the Money Management Young Achiever of the Year Award 2012 (the Award).

The Award recognizes outstanding young individuals in the financial advice arena.

Synchron Director Don Trapnell said, “Finn is truly deserving of Money Management’s Young Achiever of the Year Award. On behalf of Synchron directors, I heartily congratulate him on winning. It confirms that he is not only one of Synchron’s highest achievers but also one of Australia’s.”

Mr Kelly was a finalist for the Award last year, a finalist in the 2011 Association of Financial Advisers (AFA) Rising Star Award and winner of the 2011 AFA Excellence in Education Award.

Mr Trapnell said Mr Kelly’s win also demonstrates that Synchron’s NextGen program has played a significant role in helping to develop, foster and encourage its younger advisers.

“NextGen is a program we introduced to encourage younger advisers to join Synchron and to support their development via education, soft skills training, coaching, mentoring and lead generation,” Mr Trapnell said. “We are constantly investing in their development in order to improve the efficiencies of their practices and foster better outcomes for them and their businesses. We are delighted that our investment is paying off.”

Mr Kelly said, “This award is recognition of the great work of the Wealth Enhancer team, my partner Sarah and the support of Synchron and my mentors in the industry”.

Another cause for celebration is Mr Kelly’s engagement to his partner, Sarah Riegelhuth, at sunrise on Diamond Head at the recent Synchron National Conference in Hawaii.

In his former career, Mr Kelly spent seven years as an Army Officer in the Australian Defence Force. His formal qualifications include a Bachelor of Science majoring in Maths and Physics, a Diploma of Financial Services (Financial Planning), a Graduate Diploma of Education (Secondary), a Diploma of Government, and a Diploma of Management. He is currently undertaking the Chartered Financial Analyst Institute Program.

Wealth Enhancers is a boutique financial advice business headquartered in Melbourne.

AFA: BUDGET - ROBBING PETER TO PAY PAUL TIME TO GET SUPER SMART!

Wed, 09 May 2012 00:00:00 -1000

“Overall, last night’s Federal budget was a solid effort with the focus on getting the country to live within its means by cutting $34 billion and returning to surplus. However, if you’re in small business, or big business, or approaching retirement, you have been slugged,” commented AFA CEO, Richard Klipin.

“Government Revenue is down and confidence is down and the last thing the Government should be doing is tinkering with the superannuation system, leading to further loss of confidence and trust.

”Superannuation is not a cash cow to be milked to meet deficits. And the notion of ”robbing Peter to pay Paul” is short term thinking, leading to an environment that is not conducive to enabling the average superannuation investor to understand, and take an active role, in their retirement planning.

“Superannuation is a long term strategy and the system needs to be stable and consistent – not a moving feast in response to budget and political pressures.

“Confidence in the system has seen it grow to approximately $1.3 trillion in assets and become the fourth largest private pension market in the world. The compulsory nature of the Superannuation Guarantee, the legislated increase in mandated contributions and the tax advantaged options with respect to member contributions, make the Australian Superannuation system a strong and robust industry,” said Mr Klipin.

“The increase in mandated contributions from 9 to12% is a bold move, and well supported by the AFA, but the Government now needs to ensure that the incentives are attractive to all income levels and life stages.

“The Government should be encouraging people to fund their own retirement and incentives which do this long term will lessen the drain on the public purse. The deferral of higher contribution caps for the over 50s and the increase in tax on concessional contributions for higher income earners are hitting the very people who are in a position to focus on ensuring adequate retirement savings and, as we know from history and the super surcharge, the administrative burden will be high.

“Australians want, and need, certainty and confidence in their super. They want certainty in the rules and the ability to forward plan.

“Employers also want certainty and the ability to deliver a true workplace benefit to their employees – not just meet a legal requirement.”

Mr Klipin stressed that, “The need for long term planning can’t be emphasised strongly enough. If superannuation and retirement planning for consumers is a long term strategy, then so must be the Government’s treatment of the environment.

“Finally, we come back to what is critical in underpinning confidence by consumers, and that is quality financial advice – the right long term strategy, the right investment, the right insurance cover.”

ENTRUST PRIVATE WEALTH LIVE WITH IRESS

Fri, 04 May 2012 00:00:00 -1000

IRESS has announced that private wealth management company, Entrust Private Wealth Management (Entrust) has selected and successfully implemented IRESS as its private wealth technology platform.

Sam Marshall, Manager of Wholesale Portfolio Products at IRESS, said Entrust is the latest financial services company to recognise IRESS’ unique value proposition when combining rich portfolio management, trading and advice features in a single platform.

“IRESS worked closely with Entrust to deliver a solution that would complement Entrusts existing administration capability” Mr Marshall said. “After a number of years of outsourcing portfolio administration, Entrust made the decision to internalise. The decision to implement IRESS’ Private Wealth solution was based on its intuitive, fully-customisable capabilities to create a unique private client platform for Entrust.”

Entrust Managing Director, Graeme Yukich, said Entrust conducted an extensive analysis of five providers and the decision to implement IRESS was based on many factors, including the fact that IRESS leads the market in investment technology.

“IRESS is very professional, has a strong balance sheet, is very well-known and well-respected in the market place, and, importantly, has a unique understanding of Australian financial services businesses,” Mr Yukich said. “As existing clients, we also already knew that IRESS provides expert and elegant technological solutions that would integrate well with our existing systems.”

Mr Yukich said Entrust was particularly impressed by the automated investment management and portfolio reporting features, which he described as ‘very strong’ and the flexibility of the technology. “Unlike other systems, IRESS allows us to manage our data in any way we want,” he said.

Pricing was also important. “The IRESS pricing model is intelligent,” Mr Yukich said. “It allows us to get bigger, better and more successful without penalising us for it.”

Entrust was also impressed by IRESS’ approach. “They understood that we were not looking to simply buy software,” he said. “Their willingness to help us and the access they offered us to their experienced team made them the best by far. At the end of the day, IRESS quite simply put the best case forward.”

About IRESS

IRESS works with clients and industry participants to provide leading portfolio management, market analysis, trading and advice solutions for financial market and wealth management companies globally. Further information: www.iress.com

About Entrust

Entrust sets out to provide clients with the same investment opportunities available to the funds management industry, combined with the foresight of strategic financial planning and the transparency of quality listed securities. Further information: www.entrustpwm.com.au

MY DEALER GROUP ATTRACTS ADVISERS

Fri, 20 Apr 2012 00:00:00 -1000

My Dealer Group, the matchmaking service designed to help advisers looking for a new licensee, is attracting an unexpectedly high level of interest from advisers.

Pinnacle Practice Director, Anne Fuchs, who launched My Dealer Group in Brisbane last month, said she is receiving multiple inquiries a day from advisers.

“We expected that we would have to put a lot of energy into direct marketing to advisers to alert them to our services and let them know that we are here for them if they need help finding a new licensee relationship,” she said. “However, what we’ve found is that advisers are calling us – it’s a bit of a surprise.”

The My Dealer Group service offers independent, unbiased licensee/adviser compatibility assessments. Licensees pay a fee to become a member of the My Dealer Group panel and My Dealer Group works with them to understand their unique value proposition. My Dealer Group then showcases their offering to the advisers identified as most suited to their businesses.

Ms Fuchs said there is a common theme amongst the advisers who are contacting My Dealer Group.

“It’s love on the rocks for these advisers; they have clearly fallen out of love with their licensees,” she said. “The passion has gone, they’ve outgrown their current licensee and are looking for a new relationship to energise and motivate them.”

Ms Fuchs said she is fielding inquiries from advisers all over Australia who are in relationships with a range of licensees.

“We’ve had advisers call us from most of the mainland major capital cities but also from regional areas in Western Australia, Tasmania and Queensland,” she said. “And we’re not just taking inquiries from the small end of town. We’ve also seen interest from some well-established and very big adviser practices.”

My Dealer Group showcases licensees to advisers at no cost to the adviser.

AFA: COLLABORATE OR PERISH?

Tue, 17 Apr 2012 00:00:00 -1000

While there are still concerns within the AFA and the adviser community that the Future of Financial Advice (FoFA) reforms, recently passed through Parliament, fail to meet their stated objective of improving consumer protection and confidence, the Association of Financial Advisers (AFA) believes it is now time to put the divisions and self-interest to rest and move forward. Our focus is now on getting the best outcome with the regulations and regulatory guides and assisting our members to implement the FoFA changes.

CEO, Richard Klipin, believes that “all sectors of the industry need to now work together to achieve professional standing in the wider community and implement the reforms efficiently and effectively.

“The role of the AFA to “Lead, Support and Inspire” its members was our focus during the three year FoFA debate and we will continue to take the lead during this period of transition.

“The debate was long and intense and, with the legislation passing, it’s an appropriate time to reflect on what was achieved and ask - Was it worth the effort?

“There were many positive outcomes, some of those we see as most significant were:

Extension of an annual Opt-in to biannual, with a potential option that will enable some advisers to avoid Opt-In if they agree to an ASIC approved code of conduct
Remuneration choice for Insurance in and outside of Super (excluding group plans)
A commitment to enshrining the term(s) Financial Adviser/Financial Planner in law
“Softening” of the annual Fee Disclosure Statement requirements
The ISN agenda driving FoFA was exposed.

”During the debate, the AFA was heavily engaged with politicians, regulators, Treasury, the media, the market and all relevant committees, ensuring our members’ voices were heard.

The AFA never wavered in its commitment to support its members. We also never wavered from supporting small business financial advisers and will continue to do so during the coming transition period.”

Mr Klipin went on to say that “while the FoFA reforms are now dependent upon the regulations and will soon be with ASIC to implement, the AFA is working towards providing clarity to our members as a priority through upcoming member packs and the National Road Show.”

One of the most significant outcomes from the FoFA debate has been the mobilisation of advisers to become politically active and individually engage with their MPs. This has raised the understanding of what it is they do, and the importance of their role to the community, to a whole new level.

“This was a true grass roots movement “, said Mr Klipin, “and there is not a Federal MP across the country that does not know who we are and what we do. With a Federal election looming in 2013, we collectively need to maintain the focus and capitalise on what has been achieved.”

“In the end, the Australian community needs to be able to access trusted and affordable advice” said Mr Klipin. “This is the ambition of the FoFA legislation and, whilst it is flawed policy, it is now up to the members of the AFA to ensure we deliver as best we can on this premise.”

AFA: TRICKY POLITICS BLIGHT FOFA REFORM

Thu, 22 Mar 2012 00:00:00 -1000

The Future of Financial Advice (FoFA) reforms passed through Parliament today, after three years of debate, fail both consumers and advisers, according to the Association of Financial Advisers (AFA).

“FoFA represents the biggest changes to financial advice in a generation,” said AFA CEO Richard Klipin. “But the patchwork of changes that have been tacked on at the last minute only create more uncertainty for consumers and advisers.”

Mr Klipin expressed grave concern that the last minute amendments may have been put in place as a result of side deals involving the Industry Super Network (ISN).

“We are disappointed at the outcome and sceptical about the merits of this ambiguous deal,” he said. “It demonstrates that the Government has played favourites and has not listened to the industry.”

Mr Klipin said FoFA as it now stands advantages ISN and union industry super funds at the expense of other sectors of the financial services industry.

“Side deals negotiated by sectors of the industry with vested interests amount to tricky politics,” he said. “They represent poor process, poor governance and poor transparency – all of which spell poor outcomes for consumers and the advisers who serve them.”

Mr Klipin again called on the Government to conduct a proper FoFA Regulatory Impact Statement and release the results to the industry and the public.

Of the future, Mr Klipin said, “The AFA remains committed to working constructively with all key stakeholders as we work through the fine details and the many challenges we face.

“Our members across the country remain positive about the future of the profession. They will continue to adapt as the market changes. Their role is essential and the work they do with their clients and their communities is vital to building, managing and protecting the wealth of this nation.”

However, Mr Klipin said that while the Government has argued long and loud that FoFA has always been about consumers, the package simply does not deliver on that promise.

“Minister Shorten could have been the White Knight of financial services reform, as Paul Keating was of superannuation. Unfortunately, his legacy will be more like that of Lord Voldemort.”

ends

About the AFA

The Association of Financial Advisers (AFA) is the longest running professional financial adviser organisation in Australia and its members have been providing trusted advice to consumers for 65 years. The AFA celebrates its diamond anniversary this year. Through individual memberships and relationships with licensees, the AFA represents over 7,000 members. These members offer a broad range of financial advice services to ordinary Australians with many having specific expertise in risk protection. The AFA aims to provide a robust united voice for all financial advisers and their clients, continually improve practices and to focus firmly on the exciting, dynamic future of the financial advice profession. With six and a half decades’ success, the Association's ongoing relevance is due to its philosophy of providing leadership and direction to advisers and their clients. It is an association run by advisers for advisers - this means advisers set the agenda, decide which issues to tackle and shape the organisation's strategic plan.

AFA: FOFA SIDE DEALS NOT IN THE NATIONAL INTEREST

Wed, 21 Mar 2012 00:00:00 -1000

The Association of Financial Advisers (AFA) is calling on the Government to act in the national interest and work directly with the industry to achieve the required changes rather than negotiating through the Industry Super Network (ISN).

The call comes after news in the press yesterday which alleges the ISN has made secret side deals with a financial services industry group on issues relating to the proposed Future of Financial Advice (FOFA) reforms, such as the highly-contentious opt-in provisions and the use of the term ‘financial planner’.

“If the allegations are true, ISN is acting as a de facto policymaker on behalf of the Government. It is time for this kind of activity to end,” said AFA CEO Richard Klipin. “In the interests of consumers and the people who serve them, the Minister for Financial Services and Superannuation must fully focus on good policy.”

Mr Klipin said the ISN has spent countless millions on advertising campaigns over a decade or more doggedly maligning advisers and undermining the value of advice and the ISN’s role in the FOFA debate needs to be put into context:

They have proposed many of the contentious changes, including opt-in
They represent a small number of industry fund advisers, which constitutes less than one per cent (1%) of all advisers
The FOFA changes, as designed, will have minimal impact on industry fund advisers
The ISN, according to its own research, expects to increase adviser numbers tenfold in the next 15 years under the FOFA legislation
The ISN is a vested interest group in this debate, seeking to drive a substantial competitive advantage from this legislation

“We believe the actions of the ISN have unfairly influenced the FOFA debate,” said Mr Klipin, “But a golden opportunity now exists for Minister Shorten to bring all key stakeholders to the table and finalise all the key issues. This is the only way to serve the national, rather than sectional, interests.”

Mr Klipin encouraged the Independents to focus on good policy outcomes through amendments to the legislation. “The AFA has always supported legislation which will improve transparency around advice and increase consumer access to advice,” Mr Klipin said. “However we believe that the draft FOFA legislation, as it currently stands, does neither.”

Earlier this month the AFA sent a letter outlining its five major concerns relating to the proposed FOFA legislation to the Independents, relevant frontbenchers and members of both Houses of Parliament.