Good Returns speaks to adviser consultancy groups who say that many advisers are still dragging their heels coming up to March 15.
Ready or not, regulation change is bearing down on the financial services industry on March 15.
But adviser consultancy groups have told Good Returns, that while many in the industry are ready for change there are still a number who are procrastinating.
Karty Mayne, director and compliance consultant at Rosewill Consulting says that the current crop of advisers are “a mixed bag”.
“I think there are a group of advisers who are only engaging now for the very first time. I think this is putting consultants such as ourselves under pressure, we would like to help them but we are already committed to our existing clients.
“It is going to be hard for people who haven’t engaged until now to get the help that they need.”
Mayne says that in particular she is seeing many advisers struggling to understand the new disclosure requirements.
“There is still a tendency for advisers to think of it as a disclosure statement, there is not enough thought going into how it needs to be incorporated into advisers’ communication with their clients, making sure clients understand nature and scope, that is all a big part of disclosure now.
“A lot of advisers are thinking that they will just update their disclosure statements and think that is all they need to do. Many have not heard the messages.”
From Mayne’s perspective those advisers who are caught out in the new regime will not be spread evenly.
“I think it is going to be an 80/20 thing – 80% of the market have been engaging and are across the line or close to being ready. I think it is only a small portion who will be caught out on March 15.
“But hopefully if they can get on top of their obligations quickly, they might have a couple of weeks in March to get across the line.”
Steve Burgess, director of Compliance Refinery sees the situation in a more positive light saying that “a lot of the market is as ready as they are going to be”.
“Most of the market engaged and prepared early. While there are people who are only trying to find solutions now, that is not really representative of the majority.”
For Burgess the key issue for advisers at this point is learning how to walk the walk, after talking the talk for nigh on two years.
“Taking what you said you were going to do and operationalising it is actually a whole other skillset. The industry is going to change a lot post March 15.
“I think that a lot of advisers might say, ‘I am a good adviser, why would I want to take all this time taking all this risk?’ I think we will continue to see a lot of change in the industry, which could actually be a good thing.
“There are a lot of advisers who are good advisers, they might not want to put in that energy elsewhere.”
The biggest message that Burgess wants to get across to all advisers is that “March 15 is a hard date. They will be in a new regime like it or not.”
Ryan Edwards, managing director of The Adviser Platform, told Good Returns that they have seen “a major rise in people seeking help” and “there are still huge sections of the market that aren’t where they need to be”.
Edwards says that TAP “talks to half a dozen businesses a week from all sections of the market. Almost all are telling us, ‘I need support and I don’t know where to get it from, I am getting too many mixed messages.’
“These are people who want to get on top of things, but they just need some help.”
Though the FMA have stated that they are happy with the numbers of advisers who have signed up for transitional licences, Edwards thinks the industry needs to remember that it is only the initial step.
“The transitional licensing has obviously had a really good uptake, and there are people who are still working through that process. But as everyone is well aware that is only a very initial stage. That is advisers putting their hat in the ring to say, ‘Yes I have every intention of running a FAP.’
“The next and very tangible conversation is to talk to advisers [about] how [they] actually do that.”