Investment fund Platinum Asset Management’s founder and managing director Kerr Neilson has reached out to Tasmanian Liberal Senator David Bushby, letting him know he is unhappy with the rollback of the Future of Financial Advice (FoFA) being proposed by the Government and sought by Australia’s major banks.
This letter has today surfaced on Twitter from Neilson, addressing Bushby, the chair of the Senate Economics Legislation Committee.
Bushby’s office confirmed to Business Insider the letter has been “received and accepted by the Committee”.
— Tim Mackay (@timqfadvice) May 15, 2014
Neilson said after having forced Australians into superannuation and onto the reliance of third parties for advice “there is still confusion as to the obligations of the independence of advice (when it is sought) from financial advisers”.
Also touching on the issue of major bank influence, via their aggregation groups, he said:
Worse still, the four leading banks have considerable influence over at least 10,000 advisers (out of a pool of say 17,000 active advisers). This influence varies from employment to fee arrangements that induce a ‘loyalty’ to products managed /promoted by these banks.
Neilson added that Platinum stands on its returns and has “never paid commissions or other inducements to any financial adviser”.
He said the rollback of FoFA will mean that “the government provides little protection regarding the efficacy of the advice” that consumers receive and that there is no public benefit in the “dilution” of FoFA but “a clear advantage to an ever-tightening grip on financial intermediation by the big four banks and other large multi-product financial institutions”.
Business Insider is waiting a response from Platinum.