The case of ‘Mr E’ in 2016 exemplifies this, where an AMP planner recommended he consolidate superannuation accounts into one, causing him to lose 25% of his balance in fees, a result contrary to his goal of ‘stimulating long term wealth growth’ (“Britt, 2018”). These situations could be remedied by mandatory and rigorous reporting to a central agency like ASIC, as well as targeted examination of Approved Product Lists; perhaps a ceiling on the percentage of in-house products on this list could be established. Another solution could be another restructuring of how fees are charged, and income is made, for financial planners, the Australian government made moves similar to this in the 2018 …show more content…
David Say was one of many clients who invested funds from a self-managed super fund into the care of Macquarie financial planners, who unprofessionally and unethically handled investment decisions. Advisors specified a low-risk approach yet actually invested in highly geared private capital and equity assets. He also found ‘they were making arithmetic mistakes… mistakes of principle with things like superannuation’ (“Say, 2015”). This advice was both in breach of the firms ‘best interest duty’ and non-compliant with Say’s contract. A regulatory loophole was Macquarie Bank’s excuse for this inappropriate behaviour and advice towards clients. The planners claimed they offered no personal advice, backed by their own illicit failure to actually document any advice given, and such were not liable for the losses incurred by the customer. Although shaky, this reasoning held in most of the cases where Macquarie Bank had misguided clients. To prevent this in the future, it would be effective first for the existing loophole to be closed but also to introduce, again like other cases, more professional and ethical training to ensure the financial planning industry is fair and for the best interests of customers. If the planners were making a commission or other benefit, monetary or