Super Members Council Calls for Tighter Anti-Hawking Laws to Ban Cold-Calling Financial Services Operations
The Super Members Council (SMC) is taking a stand against cold-calling operators selling financial services, calling for tighter legislation to protect consumers from unscrupulous practices. Recent cases of advisers being banned for misleading clients into switching their superannuation funds or making risky investments highlight the need for stronger regulations in the industry.
One such case involved a Melbourne-based financial adviser who was permanently banned by ASIC for attempting to induce clients to transfer their super into a bank account he controlled through false and misleading statements. In another instance, a Brisbane adviser was banned for five years for recommending clients roll their super into self-managed super funds and invest in property.
The SMC, representing major funds like AustralianSuper and Australian Retirement Trust, is pushing for anti-hawking laws to be extended to ban financial advisers from using cold-calling businesses to attract clients. These operations often use aggressive tactics to push unsuspecting Australians into high-fee super funds that may not be in their best interest.
According to SMC chief executive Misha Schubert, reputable advisers do not rely on cold-calling to sell their services, and banning this practice would help protect consumers from being taken advantage of by unscrupulous operators. The SMC is also calling for legislation that would require super funds to verify the legitimacy of advice fees charged to members’ accounts.
By closing the loophole that allows dodgy advisers to engage in cold-calling activities, the SMC hopes to restore trust in the financial advice profession and prevent further harm to consumers. It is crucial for Parliament to act swiftly in passing these reforms to ensure the protection of Australians’ financial interests.
In conclusion, the SMC’s call for stricter regulations on cold-calling in the financial services industry is a step in the right direction towards safeguarding consumers from deceptive practices. By banning unsolicited selling of financial services and requiring greater transparency in fee structures, the industry can better serve the needs of its clients and uphold ethical standards.
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