The Investment Savings and Insurance Association (ISI) is not overly keen on the proposal for adviser regulation floated by the advisory industry, and it has set up a working party to look at other options.
The Financial Planners and Advisers Association (FPIA) has indicated its preferred option for adviser regulation is one where fund managers would only distribute their products through intermediaries who are members of a professional association such as the FPIA.
However, the ISI is only luke-warm on this suggestion.
"(The ISI) would not be prepared to limit distribution of their products to FPIA members alone," ISI chief executive Vance Arkinstall says.
"The people who are causing the problems in the investment advisory industry are not in fact selling the products of our members," Arkinstall says. "The scams which are appearing are not with ISI (member) products."
"Registration, or licensing or applying some sort of strict controls on the financial planning industry association members who distribute ISI members' products is not going to solve the problem because that's not where the problem lies," Arkinstall says.
He says the issue needs to be considered much more carefully than that, hence the ISI has set up a working party headed by AIA general manager David Whyte.
Two of the other main concerns about the FPIA proposal are:
Arkinstall says the ISI is very supportive of the FPIA and it is keen to see it grow, however he says the association has a long way to go until it is at the professional level of the Institute of Chartered Accountants (ICANZ).
"Our industry does not have a professional body which is at that (ICANZ) standard," he says. "In time groups such as the FPIA may get to that level," Arkinstall says..
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Earlier stories: Adviser regulation to go to Govt
Securities Commission wants power to ban advisers
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